AI scams, cohabiting and student loans

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1:05Hello, welcome to this Moneybox podcast. Why living in unmarried bliss might not leave you in financial misery. The government promises new rights for cohabitees. Households in Northern Ireland will pay more for electricity and gas from the 1st of July. and MPs are told that student loans in England can be compared to major financial scandals like car finance and PPI. I talked to the man making this claim. But first, a listener who was manipulated into handing over£165 ,000 to a thief tells us he's deeply embarrassed and has nothing left. When I was running out of funds, they got me to get a loan.

1:46It was£25 ,000, went over and he promised me all your money would be back to you. Within 15 minutes, nothing happened. This obviously is having an effect on me every day. Moneybox listener Jim, who was scrolling through social media when he came across what seemed to be a revelation about investing and making money in a video of what looked like a TV programme featuring someone who appeared to be a well-known money expert. But it was AI-generated and a fake, made by thieves to steal money. Our reporter Hannah Mullane has been looking into this. Hannah, how do you go from an online video to having£165 ,000 stolen?

2:26Well, Jim saw a video on social media pretending to be trusted face Martin Lewis. He clicked on a link and signed up to a fake investment platform. He was assigned what he thought was a financial advisor, but in reality he was opening up his finances to a thief. So he basically got me to open my bank account. I couldn't believe myself I was doing it at the time, but I trusted him. So he looked at what I had in there. First big payment was around about 4 ,600. A few days later, I put 9 ,500. It was incredible how it was building. He said my earning potential would be£200 ,000 a year from this. I said, well, I'd like to just actually recover the money I've invested.

3:05And he said, no, it'll be into your account by this evening. So next day, nothing. He had phone call after phone call and was told if he wanted his money back, he'd need to verify his identity by transferring more money. They asked him to do this again and again until he'd transferred his life savings and a loan, totaling£165 ,000. I'd come home from work. I'd be on the phone to him, sometimes up to two hours. It was really draining. And I got locked in, really, because all I wanted to do was get my initial money back. So tell me a bit about the impact that this experience has had on you. Hugely embarrassed.

3:43I've had to change the ring turn on my phone because every time that rang, that reminded me of the investment broker. I've got to furnish a loan of nearly£600 a month. The time I had a bit of a breakdown was on the phone to the sort of help line. And that's when I sort of broke. I'm sorry, it's really hard. I have a daughter. As a father, you want to help them as much as you can. If she decides to get married, then you do that, support them on that side of things. I just haven't got anything. I can hear how devastating the impact of this scam has been there for Jim. But this scam took place over five months and Jim's not alone.

4:29I've spoken to a number of listeners who have paid into scams just like this. I had one case of a man who, even after a conversation with me, still very much believed that the AI video that he had seen was real. And Hannah, what's Jim's bank had to say? Have they recovered any of his money? Well, there are protections in place. From October 2024, under new rules, building societies and banks have been required to reimburse victims of qualifying scams up to£85 ,000. But Jim told me that his bank did intervene to check he wanted to make these payments and even froze his account. His bank told us that he's investigating the case.

5:04As for the real Martin Lewis, he gave Moneybox his reaction. I'm really sorry to hear of Jim's situation. My problem is I've just heard it so many times. I wish this were radical or unusual, but it is now 10 years of a wild west of scam adverts on social media and it does not seem to be getting any better. and the big tech firms out there are making billions of pounds a year from the scammers. And there's still no real end in sight. We have absolutely flaccid regulation of social media out there. Well, that was the real Martin Lewis. And you could hear how frustrated Hannah and how upset he was.

5:50He also said that the big social media platforms where these thefts begin are not only not stopping them quickly enough, They're actually making money from them. What have they said to you? Well, Meta, which owns Facebook and Instagram, said it doesn't allow fraudulent activity and removes content when it's found. It also encouraged users to report content that they think is fake. And the government told us that it had invested£250 million to strengthen the fight against fraud and that they're bringing together police and industry to disrupt scams and boost support for victims. Thanks, Hannah.

6:22Well, listening to that is Aaron Chohan, member of the Fraud Advisory Panel and a lawyer who specialises in fraud cases. Aaron Chohan, Meta told Hannah it acts quickly, but clearly not quickly enough. These fake videos are generated by AI. Why can't AI be used to spot them immediately and delete them before anyone can see them? Well, these organisations, these companies are trying to adopt AI, Paul. In the case of stories like Jim, which is so sorry to hear about, these companies that recognise that AI is so quick to use and the same tools that are available to those trying to stop it are available to the criminals who use it so quickly.

7:01But these companies are adopting AI. They're trying to find ways to invest in looking at automated detection, behavioural patterns, spot the fake videos, the fake adverts. The problem is the speed of adoption of that tech. They have to go through a procurement exercise. They have to think about data protection. And in all that time, the criminals can move very quickly. So is it simply the fact that the thieves are cleverer and certainly quicker than those trying to stop them? I don't think they're cleverer. I think they are quicker. There are some really wise, well-experienced people trying to disrupt and intervene with fraud.

7:37But it's clearly not working, is it? It's growing by 6 % a year, according to CIFAS, the Fraud Prevention Organisation. And we've heard, you know, Hannah mentioned the£250 million being spent and Meta says what it's doing. It is still growing. What can be done? Well, I think what we've seen in the industry over, in the kind of counter fraud industry over the last 10 years or so, there's been a huge amount of education. We see lots of education campaigns. UK Finance had this Take Five campaign. I think what we have to be moving to is educated people how to intervene and essentially just be more sceptical when they're dealing with transactions on finance, transactions in their life.

8:21But we've heard how persuasive they are. I mean, one didn't believe Hannah when she told him it was a fake and explained why. And of course, Jim didn't do what his bank dits said, even though it froze his account, called him in for an interview and he insisted they reopened the account and then he spent the rest of his money. I mean, we can say to people, be sceptical, but really, doesn't it need something technological to stop this? Well, I think there are two sides. Yes, we need better technological advancements. We need real-time interventions by tech companies. A lot of fraud originates off tech platforms.

8:56That's set out in the government fraud strategy. So we need a quicker and a more direct kind of intervention happening from these tech platforms to stop the attacks online, but also in the communications. But I do think we need to try and find a way to get people to really understand the risks that we're facing and how to intervene, because we rarely change our view just because the risks exist. We have to think about it. So you ask someone, you know, this happened to you tomorrow, what would you do? That starts a conversation about thinking about, actually, this could happen to me. Yes, and talk to your loved ones, who often will put a stop to it, won't they?

9:32Aaron Chohan, thanks. And please remember, tell all your friends and relatives, Martin Lewis never promotes investment, nor do any other celebrities used by these thieves. If you see something where they seem to promote a money-making scheme, it is a fake. And if your bank tells you not to give them money, please believe your bank.

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10:59In the last 24 hours or so, the government has published its plans to give couples living in unmarried bliss more financial rights. Cohabiting is the fastest growing family type in England and Wales, with more than three and a half million couples living together without being married or in a civil partnership. But if their relationship ends or when one of them dies, they have almost no legal rights in England and Wales to share or inherit money or property belonging to the other, regardless of how long they've lived together or whether they have children. These new government proposals would change that.

11:32But first, our reporter Joe Krasner has been speaking to one couple in Liverpool about their relationship and their money. We are a cohabiting couple. We've lived together for approximately 25 years and I'm not particularly strongly aware or concerned about those rights, to be honest. Maybe I should be a little bit more aware of it. Yeah, I can't say I've given it much thought so far. Maybe I should. And does it concern you if anything should happen that you have limited legal protection? Obviously, the answer should be yes, but for some reason, I don't give too much consideration to it. No, sorry.

12:04I think I'm going to have to look into this now. Have you made any provision at all, any agreement regarding your status? We've got our wills. We made our wills where we leave everything to each other and then to our nephews should we both die. So that's as far as we've got so far. I think if we did split up, it would still be a sort of a fair exchange without the need to refer to a legal framework. So have you ever wanted to be a bride or a groom? Oh, you know. The sort has crossed my mind. But I seem to be alone in this. We're still looking forward to that day. Well, from wills to wedding bells, a minute in the life of a 25-year relationship.

12:46Well, with me in the London studio is Joanne Edwards. She's a partner with Forsters and on the National Committee of Resolution, which is the National Family Lawyers Association. Jo Edwards, perhaps we should think about it. How important is it for those three and a half million couples to think about these things? It's terribly important, Paul. So resolution, we've been delighted to see these proposals brought forward precisely because not enough people do think about it, whether rights on separation or rights on the first death when they're not married. And they find out all too starkly, all too late that they don't have rights.

13:23Of course, that couple has been together for 25 years. And some people do believe, don't they, that after a certain time, there's such a thing as what they call a common law marriage where you do get right. Absolutely. And it's something that despite successive education campaigns, that common law marriage myth still persists. Worryingly, around 47 % of people, even in cohabiting relationships, still believe that. So it highlights the extent of the problem and why we can't just keep saying either people need to get married or they need to be educated. Now, in these new plans just published, how does the government propose to define what a cohabiting couple is?

14:00Well, this is really important and I think something that I hope people do grapple with the detail of because I know there is concern about this prospect of the state seeming to impose rights that people don't want without any degree of permanence. But it's something that the government says very clearly. This would have to be two people living together as a couple in an enduring family relationship. There will be a checklist of factors that the court would take into account if there are any doubt about that. And in terms of eligibility, it would have to be a minimum of three years cohabitation under the proposals, except if the couple had a child or children together.

14:36And what about living together? I mean, even that's difficult to define sometimes as couples are fluid, aren't they? People might move in together, but keep their previous home or visit a few nights a week and then a few more. When would that three year clock start? It's an important point, obviously. it's one that partly the checklist of factors would deal with and it would be about a degree of permanence, whether they're in a sexual relationship, what the public perception of their relationship is. It's actually something we've got in legislation already, for example, around adoption and also plenty of other countries have this legislation already so have grappled with this.

15:10Yes, and it's different in Scotland, for example, isn't it, without going into the details and hearing all the Scottish people listening saying we've already got some of it. For 20 years, yes. And you can imagine, can't you, there'll be possibly be three-year commitment passes when it clicks in. But there could be people who leave after two years, 11 months, and then come back, maybe. There could be. I mean, this will be detail that needs to be looked at, but that is right. I mean, I think what's important here is that people just need to be aware and decide how they want to frame their relationship and then regulate it between themselves.

15:41And if they do meet the criteria and enter into what the government's calling a cohabitation framework, briefly, what rights do they get over each other's money or the home they share. So under the proposals, far more limited than if they were married. So marriage will remain what government wants to prioritise, but it will be focused on their basic needs. It's a basic framework of rights, but making sure that nobody leaves a married relationship in a position of need. But they do specifically exclude inheritance tax. They include provisions for when one of them dies about what you might get and treating them more like married couples.

16:17But they exclude inheritance tax because that's a matter for the Treasury. That seems a bit silly, to put it bluntly. Well, one would imagine that that's something that would need to be looked at. So for now, we're grateful that any proposals are out there. The intestacy rules have needed looking at for a long time, given the 3.5 million couples you have mentioned. Sorry to interrupt, but if you don't have a will, that couple did, of course, if you don't have a will, unmarried couples will get more rights under those rules than they'd have at the moment. They will. So only about one in five unmarried couples have wills, and one will get more rights under the new rules.

16:50But again, there will be qualifying criteria. So the proposal, what's being looked at, is having to live together for five years before you qualify under those rules or for two years if you've got children. So it won't be automatic that you would qualify under the intestacy rules. And Jo, we've been talking about this for goodness knows how long. It's finally here, or at least it's coming. Briefly, briefly, when can we see the law change? Well, fingers crossed, soon. It's a short consultation. Ten weeks is very short. We're told as soon as parliamentary time allows, there'll be a bill laid before Parliament.

17:23Resolution and lots of interested organisations will be engaging with that. Particularly important, we think, about victims of domestic abuse and bringing their rights to the fore. Jo Edwards of Resolution, thanks. And you can find that consultation, A Fairer End to Relationships, on gov.uk. Just search cohabitation consultation and it closes on ten weeks, as Jo said, on the 14th of August. Hundreds of thousands of households in Northern Ireland are about to face higher energy bills. The biggest suppliers of electricity and gas announced this week that prices are going up on July the 1st. Moneybox reporter Niamh McDermott is with us.

17:58Niamh, what's changing? So from next month, Power NI, Northern Ireland's largest electricity supplier, with more than half a million customers, is raising its unit price by just over 6%. For a typical household, that's about£5 extra a month. For those who also use gas, firmest energy has increased in prices in some areas by almost 16%, adding around£11 a month to bills. Both companies say it's down to rising global energy costs because of the conflict in the Middle East. But two-thirds of households in Northern Ireland use heating oil, don't they, to heat their homes, not gas. And they've already seen huge price rises.

18:32Earlier this year, as we've reported, Stormont approved a£100 payment to about 340 ,000 lower-income households to help. Have they got that yet? No, not yet. The payment isn't expected until later this year, although there's still no confirmed date. When the scheme does open, though, people will need to apply online, and those who qualify will receive a£100 prepaid voucher. There is a criteria, though. Households must have a combined income of below£30 ,000, or be receiving certain benefits, including pension credit. Also, every household in Northern Ireland should get£30 off their electricity bill each year for the next three years.

19:10That was meant to start in July, but it's now been delayed until September. Thanks, Niamh. High rates of interest charged on some student loans in England have been likened in Parliament to past financial mis-selling scandals. If a bank sold a financial product in this way, would you expect the FCA to be all over them? I'm thinking immediately of the car loan scheme or the payment protection insurance scandal, which produced exactly the outcome you described, Mr Brady, yes. Well, that was Sir Philip Auger answering a question from MP John Grady on the first day of a Treasury Committee inquiry into student loans that began this week.

19:47They were discussing student loans in England called Plan 2, which affect nearly 4 million graduates. Unlike other student loans, the interest charged on them can be well above the rate of inflation. Currently, it's up to 6.2%, though the government's pledged that will be capped at 6 % from September. Graduates are charged 9 % extra tax on any earnings that exceed around£29 ,400 a year. And that repayment threshold normally rises each year with inflation, but the Chancellor announced in last autumn's budget it would be frozen for three years, meaning more graduates will pay and those that do will pay more.

20:27Campaigners say that's a change to the terms and conditions they agreed when they took out the loan, often, of course, at just 18 years old. The Moneybox listener, Freddie, has a plan to loan and a well-paid job, but still owes more than he borrowed. So the original loan amount when I graduated in 2015 was£31 ,873. As of last month, it's now£39 ,463, which is an increase of just under£8 ,000. And I've been paying off the last 10 years. I see it every month coming off my payslip. The last one I paid was just over£400, which realistically could be going towards something like a mortgage for a house or possibly start a family for the next few years.

21:08But having that is quite a burden to carry and something you have to consider when thinking about these things, when you're sort of forecasting your life. The whole way it's set up is sort of not feel trapped, but you feel sort of no other options apart from paying this. And something like, say, you signed up to when you were 17, 18. Well, listening to that is Sir Philip Auger, who we heard briefly earlier giving evidence to that parliamentary inquiry. Sir Philip, we heard the impact on Freddie there. He's been paying off his loan for 10 years, but it's still£8 ,000 more than when he left university.

21:40And that money that he says could be used for a mortgage or having a family. You said this brought to mind mis-selling scandals with students not really understanding what they were signing up for. Is it really that bad? Good morning, Paul. The parallel with car loans and payment protection insurance schemes and the student loans is that in each case, the terms and conditions, although you can find them buried in the small print, weren't made explicitly clear to borrowers at the time they took on the loan. And in the case, as you said earlier, in the case of students, often 17, 18, making their first significant financial transaction of their lives, it's very important that the issuer of the loan, in this case the government, is absolutely upfront and explicit that the terms and conditions might change in future.

22:34And are you saying that those terms and conditions weren't explained? I mean, for example, you've got to be earning at least over£64 ,000 to even begin to pay the loan down until you earn that much. It just grows, doesn't it? Was any of that made clear to them or is that the problem you're identifying? That is the problem I'm identifying. Somewhere in the documentation, it is clear that the loan rates, the interest rates and the repayment thresholds might change in future. But that isn't spelled out to what are relatively unsophisticated borrowers. That's the thing that really has to change. And when you tell Parliament that the terms and conditions had been changed in what I think you called was an almost sneaky way, despite those clauses, what did you mean?

23:19How have they been changed since in an almost sneaky way? Well, it's almost sneaky to use a clause in the small print to change the terms and conditions that have such a serious impact, as Freddie outlined. But I had got one specific thing in mind. In the last budget, the changes to the repayment threshold were actually specified in the Treasury, in the budget document. That was when they said they were going to be frozen. That's right. the changes to the freeze in the interest rate threshold, which is actually just as important for Plan 2 borrowers. There was no mention of that at all. That's the level at which the higher rate of interest kicks in or applies in full, isn't it?

24:02And that's also been frozen, because I think it's linked to the repayment threshold, but they didn't say that. And you're saying that was sneaky or almost sneaky. So what are the options? I mean, this has all happened. It's all way back in the past when these things happened initially. what can the government do for the 4 million graduates on this plan too? Should they lower the interest rate? It's extremely tricky because the public finances are in a parlour state. The sums involved are absolutely enormous. They're enormous for the borrowers but multiply them over by the 4 million and they're enormous in the context of the public finances.

24:40Reversing the changes in the last budget, for example, would cost 1.3 billion for 2022 starters alone. Multiply that out for all of the 10 years that Plansu is in operation. So briefly, what should they do? Well, I think they should stand back and take a look at actually what is the right balance between the public and private subsidy for higher education. But there's probably a need to make a gesture. I think probably the simplest gesture, and maybe one that's most cost effective for the taxpayer and beneficial for the student, would be to allow to increase the repayment threshold as a one-off.

25:20Thank you very much, Sir Philip Auger. And there's a very useful website actually at discoveruni.gov.uk that I've only just discovered if you're thinking of going to university. Department for Education told us it recognises the concerns and says student finance has repayments linked to income and any outstanding balances and interest are written off at the end of its time. Well, that's the end of our time too. And you can write off to us, not write us off, I hope, on moneybox at bbc.co.uk with all your financial thoughts. You can also send a message or a voice note on WhatsApp 0306 783 183. We do read and listen to them all.

25:56And you never know, you might get on the show like Freddie and Jim did. And remember, you can hear the programme first and live at midday every Saturday on BBC Radio 4. In this podcast, the team was Hannah Mullane, Joe Krasner and Niamh McDermott, studio manager, Simeon Ricketts. Our editor was Sarah Rogers. I'm Paul Lewis and this was a BBC News Money and Work production for BBC Sounds. And now, you're toast. Why do some brilliant business ideas come a cropper? I'm Sean Farrington and in a new series of Toast, I'll be looking at five more brands, businesses and wonder products, which offered a lot but didn't stick around.

26:37including a budget cinema selling tickets for 20 pence and the toilet paper we knew from school. I remember worrying about getting paper cuts in an area that you wouldn't wish to be guessing a paper cut. Finding out what we can learn from their disappearance. Toast from BBC Radio 4. Listen first on BBC Sounds.

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