Keeping you and your money safe is our top priority, and we have stringent safeguarding measures in place to help protect all our customers. But there are also steps you need to take to protect yourself from fraud.
To help you identify potential scams and stay safe, we’re publishing a series of articles on fraud protection. This article looks at how to protect yourself from debt collection scams.
What is debt collection fraud?
Debt collection fraud refers to scams where criminals impersonate legitimate debt collectors, government agencies or financial institutions to trick individuals into paying money they don’t owe. These scams often use aggressive tactics, including threats of legal action, arrest or damage to your credit score, to pressure victims into making payments quickly.
These scams can be deeply distressing, especially if you’re already managing financial obligations. Victims may lose hundreds or even thousands of pounds, and in some cases, their personal data may be compromised, leading to further fraud or identity theft.
An example of a debt collection scam
James received a phone call from someone claiming to be from a legal firm working on behalf of his local council. The caller said James owed £1,200 in unpaid council tax and that bailiffs were scheduled to visit his property the next morning unless he settled the debt immediately.
The caller sounded professional and even quoted what seemed like a legitimate case reference number. James was caught off guard and felt panicked, he’d never missed a payment before, but the threat of legal action and embarrassment made him act quickly. He was told to transfer the money via bank transfer to avoid further charges and disruption.
After making the payment, James began to feel uneasy. He contacted his local council the next day to confirm the debt, only to be told that his account was fully up to date and that no legal action had been initiated. It turned out the caller had spoofed a legitimate phone number and used scare tactics to trick him into sending money.
Five tips to protect yourself from debt collection scams
1. Verify the debt before taking action
If someone contacts you claiming you owe money, don’t rush to pay. Ask for written confirmation that clearly outlines the debt, including the original creditor, the amount owed and any reference numbers. A legitimate debt collector will be able to provide this without hesitation.
2. Take your time and don’t be pressured
Scammers often rely on urgency and fear to push you into making quick decisions. They may say you’ll be taken to court, arrested or have your credit score ruined unless you act fast. But real debt collection processes take time and follow proper legal procedures.
3. Be wary of unusual payment methods
If you’re asked to pay using gift cards, cryptocurrency or wire transfers, it’s almost certainly a scam. These methods are difficult to trace and offer little protection if something goes wrong. Genuine debt collectors will offer secure and recognised payment options, and they won’t ask you to send money in ways that feel unconventional or suspicious.
4. Protect your personal and financial information
Never share sensitive details like your bank account number, National Insurance number or login credentials unless you’re absolutely sure the request is legitimate. If someone asks for this information unexpectedly or in a way that feels off, stop and double-check.
5. Watch out for signs of spoofing or impersonation
Scammers are skilled at making emails, texts, and phone calls look like they’re from trusted organisations. They might use logos, official-sounding language or even spoofed phone numbers. Look out for poor grammar, generic greetings or links that don’t match the official website. If anything feels suspicious, trust your instincts and investigate further before taking any action.
What to do if you’re targeted by a debt collection scam
If you think you’ve been targeted, don’t panic. Contact your bank immediately if you’ve made a payment or shared financial information, they may be able to stop the transaction or secure your account.
You should also report the scam. In the UK, you can report fraud to Action Fraud.
If you received a suspicious text, these can be forwarded to 7726. You can also report fake websites to the National Cyber Security Centre (NCSC).
If you’ve shared login details or passwords, you should change them straight away. Use strong, unique passwords for each account and enable two-factor authentication where possible.
More information on debt collection scams
Debt collection scams are becoming more sophisticated, but staying informed is your best defence. If you’d like more tips on protecting your money and personal information, take a look at the other articles in our fraud prevention series.
If you’ve already been affected by a scam, support is always available. Organisations like Victim Support offer free and confidential advice to help you recover.
Above all, remember that we’re always here for you. If you ever have concerns about your account or want to double-check something suspicious, don’t hesitate to get in touch. Your security is always our priority.
