Several million cases of Cyber fraud are reported to police every year, and Covid-19 has accelerated this criminal activity in the UK. Cyber criminals have been taking advantage of the Covid-19 pandemic to defraud £millions from individuals and businesses.
Action Fraud (National Fraud & Cyber Crime Reporting Centre), recently reported that more than £4.6 million had been taken from victims of Covid-19 related cyber fraud since the pandemic first hit the UK. With the UK’s fragile economy and the uncertainties associated with Covid-19 causing financial hardship, many businesses have been targeted by cyber criminals looking to exploit the situation.
Below are just a few of the Covid-19 related cyber-fraud incidents that have risen sharply since the pandemic hit the UK:
•Investment scams - victims are sent disingenuous investment advice and are encouraged to take advantage of the economic downturn by investing their money into sham investment schemes
•Invoice fraud - fraudsters intercept suppliers account details and use covid-19 as a reason to change the legitimate recipient’s account details to those belonging to the fraudsters
•Online/eBay shopping fraud - relating to the sale of fake or non-existent hand sanitisers, virus cures, treatments, face masks and testing kits
•Fraudulent supplier websites - as businesses struggle to source supplies, fraudsters list in-demand stock on fake websites and take payment without providing any goods
•Covid-19 contact tracing - fraudsters pose as NHS contact tracers and ask for personal details and even request payment in return for testing kits
•HMRC/ Government scams - businesses/individuals are sent texts and emails purporting to be from the Government or HMRC and offering grants or tax rebates. The victims follow a link to a fake website and are then defrauded, and the fraudsters extract information.
How to pursue Cyber Fraudsters
There are ways in which victims can attempt to identify the fraudsters and trace the whereabouts of the stolen money. Below we set out some of the steps that can be taken to prevent dissipation of assets and the retrieval of useful information to identify the whereabouts of the stolen money:
•Freezing injunctions – a Court order which prevents fraudsters from dissipating stolen money until a Court can give judgment. If the victim elects to commence proceedings against the fraudsters, and does so quickly enough, the stolen funds can be protected until judgment. The injunction will only be effective if it is granted before the stolen funds are further transferred or withdrawn by the fraudsters.
•Norwich Pharmacal Order (i.e. disclosure order)”– a Court order compelling a third party, such as a bank, to disclose information. Banks can be forced to reveal the details of the bank accounts to which the stolen money has been transferred, together with the names of the account holders. With the help of an NPO, a victim of fraud may be able to identify the fraudsters and determine whether any funds remain in the specified accounts, or identify to where they have been transferred, enabling further NPO’s to be obtained tracing the whereabouts of the money.
Evidence of Cyber Fraud
To pursue a cyber fraudster through the civil courts for the repayment of misappropriated funds, there must be evidence of wrongdoing. For example, this can take the form of misfeasance, misrepresentation, deceit, breach of contract, negligence, breach of fiduciary duty, breach of trust, unlawful means conspiracy or unjust enrichment.
At 3CS, our Dispute Resolution team have particular expertise in tracing and recovering assets in both the UK and overseas. If you require advice on cyber fraud or any other commercial dispute matter, please contact us.