Jonathan Stinton, Head of Intermediary Relationships, Coventry for intermediaries
Cost of living pressures, along with high gas and electricity bills, has meant that consumers are looking for ways to save money. Many homeowners are now considering how green home improvements could help them reduce their bills by increasing energy efficiency whilst simultaneously having a positive impact on the environment.
However, growing interest and availability of green home solutions has unfortunately also led to a surge in green scams. These include fake deals on sustainable home improvements, such as heat pumps and solar panels, which are often sold to vulnerable or unsuspecting clients.
Brokers have always been a crucial touchpoint for borrowers, and by being alert to these fake deals, they can ensure clients are well-informed and fully equipped to circumvent them.
Growing prevalence of green scams
According to Action Fraud, there was a 50% increase in the number of green scams over the course of 2022, with the primary victims being those over the age of 60.
Phone, text and email are all ways that scammers can target their victims, often posing as price comparison websites with ‘special deals and discounts’. Some criminals will invent fictional government grants or reference existing ones to lure consumers in. In one particular scam, which was especially common in winter, customers were invited to apply for the government’s £400 energy grant as a way to steal sensitive personal and financial details.
Criminals also target those who have already installed energy efficiency features. Scammers use publicly available data to offer free health checks for wind turbines or solar panels, sell unneeded voltage optimisers, and even claim that solar panels are potential fire risks or non-compliant with recent law changes.
Detecting criminal activity
Borrowers often turn to brokers for guidance throughout their mortgage journey, placing brokers in the perfect position to alert clients to the potential risks and educate them on how to avoid falling prey to these cons. Some useful tips that brokers could share with their clients on how to spot green scams include:
- Perform thorough research – before buying into any green products, clients should check the legitimacy of offers through company websites, reviews, or references.
- Check certified schemes – when looking for a trader to use, customers should check certified schemes that recommend traders such as the government-endorsed Trustmark scheme.
- Get written quotes and a contract – homeowners should secure quotes from at least three different contractors to determine the fair market price. Once clarified, they should always receive contracts in writing before proceeding with any refurbishments.
- Stay alert – customers should be wary when companies offer to complete applications or paperwork for government grants which are potentially fake. It is also important for individuals to check independently for any available financial support through local government agencies.
- Use a secure payment method – credit cards offer the most protection, followed by PayPal or debit card. If possible, sometimes the best option is to pay in instalments to avoid paying large upfront costs where possible.
With the Consumer Duty regulations demanding higher standards of consumer protection, brokers can go a step further and demonstrate their commitment to their clients by making them aware of common scam tactics and help them to make safe and informed financial decisions. This will give their clients the confidence to undertake important energy efficiency improvements to their property, fend off fake deals on sustainable home improvements and help to save the money in the long term.
