UK banking customers sent £101.2 million to criminals after being tricked by ‘authorised transfer’ scams in the first six months of 2017, new research has found.

The figures from UK Finance revealed the growing problem of criminals targeting consumers and businesses directly to trick them into authorising a payment. Data found that there were 19,370 cases in H1 2017, with 88 per cent of them being consumers losing an average of £3,000, and the remainder businesses who lost an average of £21,500 per case.

Current legislation means that consumers have no legal protection to cover themselves for losses if they authorise the payment themselves – unlike other financial frauds where the criminal makes the payment without a customer’s consent. In this instance, financial providers were able to return £25.2 million of the losses to customers over the six-month period.

Katy Worobec, head of fraud and financial crime prevention, cyber and data sharing at UK Finance, said: “These figures confirm that criminals are enjoying a great deal of success targeting customers directly and tricking them into falling for their scams. There is no fast or surefire solution, but the industry is determined to crack down on these criminals on all fronts.”

The UK’s Payment Systems Regulator (PSR) this week published a report on the issue, outlining the progress of initiatives currently underway in the industry to protect consumers from these ‘authorised push payment’ scams. The body also announced it was launching a consultation on a ‘contingent reimbursement model’ that it believes should be introduced to compensate such victims in certain circumstances.

Stephen Jones, chief executive of UK Finance, commented: “Today marks an important step forward in the battle to fight the serious problem of criminals tricking customers into authorising payments and we are pleased the regulator has acknowledged everything the industry has achieved to date.

“We are under no illusion that more needs to be done and we support the PSR’s desire to develop a mechanism to return more stolen funds to victims. We look forward to working with the PSR to secure the vital changes to legislation needed to enable the proposed refund model to work, and help deliver further positive change for customers as quickly as possible.”

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