What are tax scams?
Imagine you received an email or text message from HMRC, saying that you are eligible for a tax refund of £500. It looks official, it comes at a time you’re expecting to hear about your tax rebate or bill, and it has the right HMRC logo. You’re asked to click on a link and fill in a form with your personal and financial details, such as your name, address, bank account number where the refund should be sent, and your HMRC password. You’re excited by the prospect of getting some extra money, and don’t want to miss the deadline…so, you click on the link and enter your information, hoping to receive your refund soon.
However, the link you clicked on was a phishing link, and instead of getting a nice cash payment, you find yourself losing money.
This is just one example – but unfortunately, every year new and more creative scams emerge, and more people are targeted.
The psychology of a scam
Scammers often use mind tricks to bait their victims, such as creating a sense of urgency, fear, or greed. They may also exploit your emotions, such as your trust, sympathy, or curiosity. These tactics can make you more likely to act impulsively, without thinking rationally or critically.
Using emotive topics - a tax refund or some type of reward to motivate us, using threats of fines or legal action to cause panic - triggers 'fast/reflexive' thinking. This can lead to clicking on a link, revealing information, or opening an attachment - responses that all work in a scammer's favour.
Scammers use certain key dates, such as the end and beginning of the tax year, to give their messages more credibility. Financial baits are even more prevalent during times of economic crisis as more people are likely to focus on the potential reward than they are to notice the risk.
