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Tuesday 23 October 2018

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Half a billion scammed so far in 2018

Written by Peter Walker
25/09/18

A total of £503.4 million was stolen by criminals through authorised and unauthorised fraud in the first six months of 2018, according to data from UK Finance.

During the same period, the finance industry prevented £705.7 million of unauthorised fraud, equivalent to £2 in every £3 of attempted unauthorised fraud.

Newly-collected data, published for the first time by the industry association, has revealed that purchase scams were the most prevalent authorised push payment (APP) scam in the first half of 2018, accounting for almost two thirds of reported APP cases; with a total of £19.4 million lost. In these scams, the victim pays in advance for a product or service - such as a car, electronics or a holiday rental - which is never received or does not exist. It often takes place online, through auction websites or social media.

There was a total of 3,866 reported cases of impersonation scams in the first six months of 2018. In these scams the criminal purports to be from the police, bank and other organisations and tricks the victim into transferring money, often claiming there has been fraud on the account. The nature of these scams means the victim is often persuaded to transfer a significant sum, with an average loss in a police and bank impersonation scam of £11,402.

Katy Worobec, managing director of economic crime at UK Finance, said that criminals target their victims indiscriminately and the proceeds go on to fund terrorism, people smuggling and drug trafficking, whether or not the individual is refunded.

“The finance industry is committed to fighting back, investing millions in security systems and cyber defences to protect customers,” she continued. “We have brought in new standards to ensure scam victims get the help they need from their payments provider; we are supporting law enforcement in disrupting the criminals and freezing stolen money; and we are assisting the government in improving intelligence sharing to extinguish the threat.”

UK Finance noted that the industry is working with consumer groups as part of the APP Scam Steering Group set up by the Payment Systems Regulator, to develop an industry code clarifying the circumstances in which the victims of authorised push payment scams will be reimbursed by their payments providers.

It is working with the Information Commissioner’s Office to establish guidance on how information about APP scams can be shared between UK Finance members.

Companies are also implementing new standards to ensure those who have fallen victim to fraud or scams get the help they need.



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