Young people are particularly vulnerable to financial fraud, with many under-30s being targeted by criminals as "money mules", the Financial Ombudsman Service (FOS) has warned.
The Financial Conduct Authority (FCA) has in the past highlighted increased fraud activity directed at older people, which was mostly pension-related. But the FOS said there was evidence younger people were also particularly at risk of getting caught up in financial fraud.
According to fraud prevention body Cifas, which issues the marker, ‘misuse of facility' fraud can carry prison sentences of up to 14 years.
One complainant, whom the FOS called Miss K, had reached out to the service after her bank blocked her account and she received a letter stating it no longer wanted her as its customer.
Other banks also refused to help the 21-year-old without explaining what the problem was, she told FOS.
As FOS later found out, the young woman had unwittingly laundered money for her new boss after accepting a job she had found on a classified ads site.
The boss had asked her to receive money into her bank account and to send it onto his clients. After investigating the email trail, the FOS concluded there was no evidence to suggest she had knowingly been involved in the fraud. It told the bank to remove the Cifas marker from her records.
Other cases that had started with a complaint about their banks were found to be less straight forward, however.
In one instance, a vulnerable girl was seemingly lured into providing her account for money transfers after she was bullied at school. In another, a 16 year-old sixth- form student was deemed by the FOS to have been involved in a fraud committed via her own account.
The FOS said: "There is evidence that younger people are particularly at risk of unwittingly getting caught up in financial fraud. According to Cifas, over half of ‘misuse of facility' fraud involves people aged under 30. This generally involves, knowingly or otherwise, acting as a ‘money mule' - allowing criminals to launder money through your account in return for a cash payment."
It added: "The consequences of being a 'money mule' can be extremely serious - in some cases, leaving young people with a criminal record that has an impact into their adult life. Those who contact us often do so after their bank closes their account without warning - and they discover they have a fraud marker on their records."
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