The National Anti-Scam Centre is urging Australians who have had money stolen by scammers to be wary of offers to recover their money for an upfront fee.

Reports that involve a money recovery element are on the rise. Between December 2023 and May 2024, Scamwatch received 158 reports with total losses of over $2.9 million, including losses from the original scam.

The number of reports increased by 129% when compared to the six months prior, however financial losses decreased by 29% from $4.1 million.

Victims of previous scams are easily identified by criminals who commonly keep and sell information about individuals they have exploited.

Australians aged 65 and older were the largest reporting group and suffered the highest average losses.

Many scammers promise victims they can recover their losses for an up-front fee. However, even legitimate scam investigation services are rarely able to recover money for scam victims. The National Anti-Scam Centre does not recommend victims of scams engage with services or individuals who claim they can recover stolen money. Victims are encouraged to report the scam to the police and contact their financial institution.

Ongoing losses to scams highlight the importance of introducing mandatory industry codes as soon as possible.

Unfortunately, most money stolen by criminals is transferred offshore very quickly making recovering of funds difficult. The National Anti-Scam Centre considers compensation will be an appropriate and necessary part of external dispute resolution where a business doesn’t meet its legal obligations under the proposed mandatory codes.

• How the scam works

Criminals contact victims posing as a trusted party such as a government agency, cyber security organisation, fund recovery service, lawyer, consumer advocacy group or charity. They might use email, phone calls, mobile apps, social media or text to contact victims.

In some cases, victims first encounter the criminals through an advertisement on social media or from searching the web.

The criminals tell the victims that they can recover their losses for either an upfront fee, a percentage of the lost funds, or a tax payment. They even tell victims that they can track-down lost cryptocurrency.

The criminals ask for the victim’s personal information under the guise of verifying their identity, or to set up a cryptocurrency wallet to facilitate payments from victims for their services.

Criminals may also request to remotely access the victim’s devices to obtain personal information and identification details.

Criminals may also pretend to be a scam victim themselves and claim that a specific person or entity has helped them recover funds. They will refer victims to fake recommendations left on review websites, or by direct contact with people claiming to have been scammed.

To appear legitimate, criminals may make use of websites advertising their services that look professional or provide victims with detailed guides and other paperwork as part of the ‘recovery’ process.

Stop. Is it a scam? Building our defences with scam sense

Follow these steps to protect yourself from scams:

• Step 1: Stop.

If you have been scammed before and see an ad or are contacted by someone with an offer to help recover money for an up-front fee, it’s a scam.

Say no, hang up, delete and block any repeated attempts of contact.

• Step 2: Check.

Criminals pretend to be from organisations you know and trust. Verify who you’re speaking to by contacting the organisation directly using contact information sourced independently.

• Step 3: Protect yourself.

Never accept offers from anyone who contacts you and says they can get your money back. Make all requests to recover your money to your financial institution and report to the police.

Don’t give financial, cryptocurrency or account details, or copies of your identity documents to anyone online who you’ve never met in person.

Never give strangers remote access to your computer even if they claim they are legitimate.

Only use lawyers that are registered with the official Law Society or Bar Association in your state.

If a criminal has your money or personal details:

Call your bank immediately using a number from your banking app or on your bank card.

Contact IDCARE for support, on 1800 595 160.

If, after contacting your financial institution you are unsatisfied with their response, you can make a complaint to the Australian Financial Complaints Authority (AFCA – www.afca.org.au). AFCA provides consumers and small businesses with fair, free and independent resolution for financial complaints.