Fraud cases have surged by 16%, with scammers stealing over £3 million daily, according to banking industry data. UK Finance, a trade association, reported that criminals have increasingly targeted victims by deceiving them into revealing one-time passcodes.
Despite the rise in reported fraud cases, overall losses have slightly declined, amounting to £572 million in the first half of the year. Banks have labeled fraud a “major threat” to the UK and urged more support in combating the crime.
The data follows recent media reports of multiple fraud incidents involving e-money company Revolut. One victim shared that £165,000 was taken from his business account within an hour. Revolut responded, saying it had “robust controls” in place.
The increase in cases during the year’s first six months compared to last year is attributed to changing fraud tactics. Losses from unauthorized payments jumped 5%, partly due to fraudsters finding ways to bypass security measures.
Typically, customers receive a one-time passcode to verify online payments, but scammers have developed techniques to trick individuals into divulging these codes, allowing them to steal funds.
However, the latest figures indicate significant declines in romance and investment scams, possibly due to anticipated stricter regulations on authorized push payment (APP) fraud prevention.
The introduction of stricter rules for authorized push payment (APP) fraud aims to enhance customer protection and hold banks more accountable for reimbursing victims promptly. These new measures, set to take effect soon, are expected to make it harder for scammers to exploit weaknesses in payment systems and deceive customers.
Despite the drop in romance and investment scams, other types of fraud continue to present significant challenges. Impersonation scams, where criminals pose as trusted entities such as banks or government agencies, have remained prevalent. Fraudsters often use convincing tactics to pressure individuals into transferring money or providing sensitive information.
UK Finance has emphasized the need for a collaborative effort across the financial sector, law enforcement, and regulatory bodies to tackle the evolving threat of fraud. The organization also highlighted the importance of public awareness campaigns to educate people on how to recognize and avoid common scam tactics.
Banks are continuously investing in technology and cybersecurity measures to improve fraud detection and prevention, but industry experts warn that the fight against fraud is a constant battle, as criminals quickly adapt to new security measures. The ongoing challenge is to stay ahead of fraudsters who continue to innovate their methods for targeting potential victims.
As the landscape of financial crime evolves, the focus remains on strengthening defenses, enhancing customer education, and implementing effective regulations to reduce fraud losses and better protect individuals and businesses.
