With online fraud growing and the annual cost of identity theft to the economy estimated at 1.2 billion, the threat of being scammed is a very real one. That said, there are steps you can take to reduce the chances of becoming a victim of fraud, meaning that you can protect yourself and your identity from potential scammers.

However, unfortunately fraud still happens and if it happens to you, you'll want to know what to do about it.

How will I know I've been scammed?

There are several things that might give you a clue that someone has stolen your identity, stolen money from an account of yours, or is otherwise using your personal details for their own gain. Here are the essentials to look out for:

  • You check your credit report and find entries that you can't explain.

  • You notice transactions on your bank or credit card statement that weren't carried out by you.

  • You apply to claim benefits but are told you're already claiming.

  • You receive bills or invoices for things you haven't knowingly paid for.

  • You're refused forms of credit even though you have a good credit history.

  • Post you are expecting never arrives.

If any of these things happen to you, you can be reasonably suspicious that you are at risk of or may already be a victim of fraud.

So what can I do about it?

First of all, don't panic. It may be that a transaction on your statement that seems strange can be traced back to a harmless source; for example you might see a payment of 50 to your local supermarket when you know you only spent 20 - until you remember you asked for 30 cashback that day. It may also be that a mistake has been made by your bank which can easily be rectified.

As such the first thing you should do if you spot an anomaly regarding the use of your credit card, debit card, a cheque or an online payment is contact your bank. Your bank (or the financial organisation who issued the card or account) will then report the matter to the police if necessary, and give you all the support you need to get the problem sorted..

In all instances if you think you've been scammed your bank should be your first port of call. If you suspect money has been stolen from your account you can call Crime Stoppers too on 0800 555 111. If any of your personal documents have been stolen such as your passport or driving license, report this to the relevant organisation right away (Home Office Identity & Passport Service for lost passports, DVLA for lost driving licenses).

It may also be a good idea to register with CIFAS if you have had personal documents stolen as they provide a service recommended by the FCA whereby your personal details will be protected in future - though membership does cost upwards of 20 a year.

Finally, you can also contact a credit reference agency if you think you've been a victim of fraud or if you see something suspicious on your credit report. Get in touch with Experian, Equifax or Callcredit (you only need to contact one, as the information will be passed on to the other two) and they will be able to advise you on what to do next.

When to protect your mail

If you move house, arrange to have your mail redirected to your new home for at least a year. You should also notify your credit card companies of your move along with any other businesses you have dealings with.

You should never throw away any old bills, bank statements or personal correspondence without shredding them first. It's best to use a 'cross-cut' rather than a 'strip' shredder as these do a much better job of destroying your information.

Keep your personal information personal

Cancel any lost or stolen credit cards as soon as they go missing; this will help to minimise any collateral damage. It can be useful to keep the relevant contact numbers to hand and copies of both the front and back of all your cards hidden in a safe place at home so that your account numbers and sort codes are accessible in an emergency.

Keep your passwords and pin numbers in a very safe place (your head alone is best!) and never ever written down in your wallet or diary (or any other equally obvious place). It's strongly advisable to use different passwords for different accounts otherwise theoretically if someone can access one of your accounts, they can access all of them.

Check any statements for unauthorised transactions as soon as you receive them and notify your bank immediately if you notice anything 'dodgy'.

How to play it safe online

Use only reputable websites and only ever enter your personal details on secure websites signified by 'https://' at the start of the url and a padlock or key symbol displayed on the webpage.

Your bank or any other financial institution will never contact you by email asking you for your personal details. If you receive an email of this nature delete it straight away and never click on any links enclosed. These particular scams are known as phishing and exist with the aim of transferring you to a look a like site and capturing your personal details.

Ensure your computer (and any computer you enter your details into) has an up to date firewall and anti-virus software installed, this will help prevent hackers gaining access to your personal information while you're online.

What to watch for when you're out and about

When taking cash out from an ATM look for signs of tampering - does there appear to be something stuck on the front, is it different to how usual cash machines look? If you notice anything suspicious report it to the police or bank and under no circumstance place your card in it. Additionally, as you type your PIN number into a cash machine, use your other hand to shield what your doing from view.

Never let anyone disappear with your cards regardless of where you are and what you're paying for, most establishments now have portable card machines but unfortunately this does mean saying goodbye to bar tabs.

While no one is infallible, by taking these few precautions you should be able to protect yourself and your identity from fraud.