BBC News research indicates consumers have been duped into sending £4m a day to criminals, a 71% increase over the first six months of last year. P2P payments have become a major vector for fraud and less than half of the money lost is refunded by banks, probably because the account holders sent the money based on their own free will. It takes a closer look at Romance and Impersonation crime and includes interviews with victims:
“More than £4m on average was stolen by fraudsters every day in the UK during the first half of the year as losses skyrocketed during the pandemic.
Fraud committed when individuals are tricked into handing over money and personal details surged by 71% compared with the first six months of last year.
Less than half of the money lost in these cases was refunded by banks.
Banking trade body UK Finance said teenage criminals buying fraud kits online were among the con-artists.
In total, £754m was stolen through fraud in the first half of the year, an increase of 30% compared with the same period last year.
Within this total, so-called authorised push payment (APP) fraud – when victims think they are paying a genuine organisation – rose by 71% to £355m.
Those scams can range from fake delivery texts asking for payment, which were common during the pandemic, to higher-value losses when fraudsters pretend to be solicitors during a house purchase.
Romance and impersonation scams rising
APP fraud losses have now outstripped fraud losses on bank and credit cards for the first time. Impersonation scams more than doubled (up 123%), investment scams rose by 95% and romance scams were up 62%.
Negotiations between banks to create a permanent, central pot of money to refund these scam victims collapsed earlier this year.
Katy Worobec, managing director of economic crime at UK Finance, said: “We are calling for coordinated action and increased efforts from government and other sectors to tackle what is now a national security threat.””
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group