Student scam alert: what freshers need to know
Ruthless scammers are targeting students in a ploy to get them to hand over their mobile phones.
Hundreds of students have encountered fraudsters who try to persuade them to sign up to a new mobile phone contract in the hope of pocketing some extra spending money by selling the handset on immediately to another company – only the company doesn't really exist.
The student never receives the money for the phone, nor do they get the regular income they were also promised as part of the initial deal. What they do get left with is the liability for the new user's debts. One very unlucky student victim ended up owing £10,000, said the police.
They could also have given away their personal information such as clues to their passwords and PINs in the process, warned Andrew Webb, sales and marketing director of credit score company Equifax Personal Solutions.
The scam was exposed recently by the BBC after a student victim came forward, and Equifax is now alerting students (new and existing) and their parents to other attempts to trick them into parting with their valuables and personal details.
Have you been scammed? Let the Moneywise Scam Watch team know by emailing email@example.com
Living in communal accommodation poses ID theft risks, according to Webb. "It can take as little as just three pieces of personal information to commit ID fraud, so it's absolutely crucial that students stay alert to the risks – and we think it's a message mums and dads can reinforce before their children embark on the next stage of their education.
"From making sure they don't leave post in communal hallways for fraudsters to skim through, to not giving away too much personal information in exchange for apparently great deals and offers, this year's freshers need to be alert to the risks."
He explained that falling victim can make life difficult for students: "Once a fraudster has sufficient information to steal someone's identity it can take many hours to rectify records held by all sorts of organisations. In the meantime, it can be exceptionally difficult to carry on with everyday life, especially where it requires access to credit, including something as simple as a mobile phone contract."
This is because any negative experience on an individual's credit history makes it harder to secure borrowing in the future.
Facebook and social media
Equifax is also warning of the risks of fraud associated with social networking sites and posting any personal information online.
"Students should think very carefully about the number of people they will be meeting at university who will become Facebook friends, allowing access to all their information," added Andrew Webb. "How well do they really know these 'friends'? Can they be trusted not to abuse their personal information?
"The key to protecting your identity is not to leave personal information lying around and think twice about what information you post online or give out."
Here are some tips for avoiding student scams from the company:
- If you have a communal hallway, have important documents such as bank and credit card statements sent recorded delivery or delivered to a family home address
- Password protect all digital devices, including smartphones
- Don't store PINs and passwords on mobiles and laptops, as thieves could use this information to access your personal information
- Try not to access online banking and secure sites using public computers and if you do make sure you log out of the site in addition to closing the window
- Keep personal documents secure - when you go out make sure you only take those documents you need
- Never share your password or PIN with anyone
- Restrict the amount of personal information you provide when posting your CV online or making it available to others – you can always provide more information at a later date.
- Check that any websites on which you upload personal details are secure by looking for the padlock icon
- Redirect mail if you move, so personal information can't be accessed by fraudsters
- Always check bank statements and credit card statements carefully against receipts to ensure that there have not been any unexpected transactions
- Make sure you have up-to-date virus protection installed
- Check your credit report regularly to ensure there has been no unauthorised activity.
Your credit score is a three-digit number (ranging from a low of 300 to a high of 850) calculated from the information in your credit report. Your credit score enables lenders to determine how much of a credit risk you are. Basically, a low credit score indicates you present a higher risk of defaulting on your debt obligations than someone with a high score. If you have a low credit score, any products you successfully apply for will carry a higher rate of interest commensurate with this risk.
A report containing detailed information on a person’s credit history, a record of an individual’s (or company’s) past borrowing and repaying, including information about late payments and bankruptcy. It also includes all applications a person has made for financial products and whether they were rejected or accepted. Your credit report can be obtained by prospective lenders to determine your creditworthiness.
Used by the holder to buy goods and services, credit cards also have a monthly or annual spending limit, which may be raised or lowered depending on the creditworthiness of the cardholder. But unlike charge cards, borrowers aren’t forced to pay the balance off in full every month and, as long as they make a stated minimum payment, can carry a balance from one month to the next, generating compound interest. As the issuing company is effectively giving you a short-term loan, most credit cards have variable and relatively high interest rates. Allowing the interest to compound for too long may result in dire financial straits.