Scammers are taking advantage of legitimate green home improvement schemes to defraud consumers of money, industry experts have warned.
New figures from Action Fraud obtained by consumer group Which? reveal the “fear and confusion” resulting from soaring bills is being exploited by criminals to ramp up their energy-related scams
The figures show that in the first quarter of the year there was a 10% increase in scams mentioning one of the legacy energy retailers when compared to the same period last year, with a 27% year-on-year increase in January.
“In 2021, as many as 1,505 scams were reported to Action Fraud which mentioned one of the big six energy suppliers (British Gas, EDF, Eon, Scottish Power, SSE and now defunct Npower).
“We believe the true number to be significantly higher however, with many fraud attempts going unreported,” Jenny Ross, Which? money editor, told Utility Week.
The consumer group warned that criminals are taking aim at people seeking to access government grants for things like insulation and heat pumps.
One consumer reported a scam email purporting to be from SSE which promised “modest and therefore seemingly legitimate interest rates” of 1.75% to 3.74% on a fake ‘sustainability-linked bond’.
Ross added: “As the government continues to roll out plans to help the UK achieve a target of net zero by 2050, a number of green home improvement grants have been made available to incentivise people to take up products such as insulation and heat pumps – most recently the Green Homes Grant, which ran from 2020 to 2021.
“Unfortunately, scammers have also got in on the act, impersonating legitimate schemes via online adverts, cold calls and even making direct approaches on the doorstep. Many people have been conned into paying for tradespeople who never follow through on the work paid for.”
Among the most common scams involve methods using phishing emails, where a criminal poses as an energy retailer and emails the customer inviting them to claim a refund due to a miscalculation on their energy bill.
Furthermore, the research highlighted how the demise of a number of energy suppliers has added to the confusion.
Around 30 retailers have exited the market since the start of the energy crisis last September, with more than 2.6 million consumers being transferred to an alternative supplier and 1.7 million Bulb customers finding themselves under the Special Administration Regime.
Which? said the demise of a number of retailers has created an “atmosphere of confusion” around outstanding bills, with scammers leveraging this uncertainty to pose as debt collection firms.
It is “particularly concerned” by the opportunities for customer information to be mishandled or stolen as companies enter the Supplier of Last Resort (SoLR) process and personal data is shared between various organisations.
Other scams include criminals cloning prepayment meter tokens with pre-loaded credit before selling them at a cut-rate to consumers. While these could allow consumers to make significant savings if the credit on the card was worth more than what they paid, victims can end up paying for their consumption twice when their supplier discovers what is happening.
Ross added: “To help customers tell the difference between legitimate communications and scams, Which? encourages firms to ensure consistency in their communications to make it easier to spot when something doesn’t look right.
“For text messages, companies can sign up and follow the guidance in Which?’s SMS best practice guide.”
Responding to the research, an Energy UK spokesperson said: “We know that sadly fraudsters are trying to take advantage of the current situation whether that be through phishing emails or bogus devices that claim to save money.
“Suppliers work with the police and other authorities to help raise awareness and take action to reduce the threat.
“The advice for customers is to be extremely cautious before responding – especially if it’s an usual request or seeking personal information like bank details – and check with your supplier first if you have any concerns at all that the communication isn’t genuine.”
A spokesman for SSE Energy Solutions told Utility Week that the firm was not aware of the particular case highlighted by Which?.
He added: “SSE Energy Solutions provides advice on our website regarding everyday security measures that customers can take to protect themselves from scams.”