Frauds and scams see criminals steal £500m in H1 2018

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Image courtesy of: shutterstock.com/Lemau Studio

The first six months of 2018 saw more than £500 million stolen from customers through fraud and scams, according to new data from UK Finance.

Newly-collected data reveals 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 and in other impersonation scams of £7,504.

“Fraud and scams pose a major threat to our country,” said Katy Worobec, MD of Economic Crime at UK Finance.

“The finance industry is committed to fighting back, investing millions in security systems and cyber defences to protect customers.”

UK Finance began collating data on APP scams for the first-time last year. In the first half of 2017 there were 19,370 cases of APP scams reported, with £101.2 million in losses.

However, the data published today is not directly comparable with the 2017 figures. At the start of 2018, new industry guidelines were introduced which have improved the identification and reporting of APP scams.

Four additional banks also began reporting the data to UK Finance this January.

In context, there was a total of over 4.2 billion bank transfers made in 2017.

The enhanced data on APP scams, collated since the start of 2018, provides a breakdown by different scams, payment types and payment channels.

The data shows the most prevalent type of APP scams were purchase scams, accounting for 63% of cases. While CEO fraud had the least number of cases, it resulted in the highest average case value of £23,055.