Matthew’s phone was snatched from his hand. In minutes, he’d lost thousands

Today I’ve got a frightening warning for everyone using a mobile phone. And it comes from a real story about Matthew, a friend’s son who was robbed using his own mobile phone last week – and a growing number of situations just like his are happening all over the world.

Matthew*, 26, was standing on the street corner at 7pm on a Friday night in Angel Islington in London, ordering an Uber on his mobile phone. A thief sprinted past, snatching the unlocked phone from his grip. Within minutes, a nightmare unfolded.

Be careful when using your phone in public while overseas.Credit: Digital Vision

With the unlocked phone in hand, the thieves had an open and free pass into Matthew’s financial world. They immediately reset his phone password, then set about using his email address and text messages, which they had direct access to, to confirm two-factor authentication on his bank accounts.

They transferred thousands of pounds from his accounts, intercepting the text messages to authorise the bank transfers that come into your phone. Then they started purchasing online gift cards with his credit cards. They also reset his passwords, locking him out completely.

Then, they accessed his WhatsApp, messaging his friends and his boss, claiming that he’d lost his phone and was stranded and in urgent need of money. More than £7500 ($14,627) was transferred to his accounts – everything they could access using his online banking cards.

Matthew was initially slow to act – caught off guard by the situation and unaware of the full extent of the thieves’ plan or how to respond effectively. Fortunately, he was with two friends who helped him get home.

By the time he arrived, the damage was severe. His bank accounts had been drained, his credit cards maxed out, and, of course, his phone was gone. They’d changed his access passwords to Gmail, and several other crucial services too – giving themselves the power to do anything.

Desperate for help, Matthew reached out to his mother, Fiona, who immediately sprang into action from Australia, determined to help him regain control. But the thieves, still logged into his device, could see all his messages and see their management plan unfolding in real time.

He locked down the bank account, contacted his phone provider and filed a police report – probably in the wrong order. Then he set about trying to recover his Gmail account – a very difficult process that takes 48 hours at best.

Matthew did have a stroke of good luck on three fronts. A few months earlier he had elected to take out a monthly premium insurance policy with his bank, for £15 a month – so his bank treated him with priority, and the policy offered him “phone insurance” so he had a new phone delivered to him by the insurer the next day.

The lesson for both travellers and everyday people is clear: stay vigilant and take steps to protect your device and personal information.

He managed to shut down his bank accounts before his friends sent him another £2000 in incremental payments too, so he was able to pay all that back.

Finally, on his Gmail account, he had listed his mum as the secondary email address, rather than listing a secondary personal email such as his home or work email that was also visible on the device.

The fact that he had a different email meant that when he triggered the reset on the account passwords, the thieves couldn’t see the confirmation emails, and they couldn’t thwart his efforts by clicking the confirmation emails to say the report was invalid. This was a critical and valuable step.

It’s worth noting that Matthew is a young Aussie traveller overseas with limited cash in his accounts. Imagine the havoc thieves could wreak on someone with more complex finances – a home loan with a redraw facility, a cash management account holding retirement savings, or daily transaction limits set too high. The potential for financial devastation is far greater.

Two weeks on, Matthew has a new phone. His bank, Monzo in Britain, has refunded the stolen money, and he has painstakingly regained access to his Gmail and other accounts. While he’s now back on track, the process was both time-consuming and stressful.

Spokespersons from both the Commonwealth Bank and Westpac confirmed that in similar situations, they would protect their customers from losses due to unauthorised transactions, provided the customers had taken reasonable steps to safeguard their accounts against unauthorised access and proactive steps in real time after the theft – no delays in reporting it, or limits on the bank’s ability to act.

Open phone theft is surging, with British police reporting 75,000 cases in the past year alone. This isn’t just a London issue – or just a problem for travellers. Similar crimes are being reported in cities worldwide, including in Australia, where banks are seeing a sharp increase in phone theft.

The lesson for both travellers and everyday people is clear: stay vigilant and take steps to protect your device and personal information.

Whether you’re scrolling your phone outside a cafe or navigating a map with your phone in hand, sitting in a restaurant with your phone on the table beside you, or like Matthew, ordering an Uber, thieves are watching for moments of distraction.

Keep your phone secure, adopt features such as facial recognition, and avoid holding your phone out in public unnecessarily. A little extra caution can save you from a big headache, whether you’re at home or abroad.

*Names have been changed.

Bec Wilson is the author of bestseller How to Have an Epic Retirement. She writes a weekly newsletter at epicretirement.net and is host of the Prime Time podcast.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making financial decisions.

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