Rise of the scammers
BANK FIGURES SHOW THE TYPES OF CONS THE UK PUBLIC ARE INCREASINGLY FALLING FOR
People sent more than half a million pounds a day to scammers in the first half of 2019. People sent more than half a million pounds a day to scammers in the first half of 2019. That’s according to a shocking new report from banking industry body UK Finance, which reveals a staggering £569,863 was handed over every day on average.
It means that in the first six months of the year, £207.5 million was lost due to what is known as authorized push payment (APP) fraud. This happens when customers are scammed into sending money to an account they believe is legitimate but is actually controlled by a criminal.
When a customer authorises a bank transfer - even if they are tricked into doing so - current legislation means that they have no legal protection to cover them for the losses.
That’s different from unauthorised transactions, where customers have legal protection.
The figures show a 49% increase in APP fraud since the first half of 2018 although two more banks have started reporting figures in the interim.
The most common type of authorised fraud was purchase scams, with 35,472 cases in the first half of this year worth a combined £27.9m. These occur when people pay in advance for goods they never receive including fake holiday rentals, cars, phones, or concert tickets.
The next most common type was invoice and mandate scams (4,659 cases worth £55.9m).
These are where criminals intercept emails and convince victims to pay legitimate invoices into the wrong account - often claiming the bank details have changed.
The method is similar to CEO fraud (worth £7.9m) - which occurs when a scammer impersonates a CEO and convinces the victim to redirect a payment.
People were scammed on 4,601 occasions into sending ‘advance fees’ to criminals in return for what they thought would be larger payments. Impersonation also remains a popular scam method.
People transferred £35.4m on advice from what they thought was their bank or the police - but was actually a criminal.
A further £20.9m was transferred to scammers impersonating other organisations like utility companies and government departments.
People also lost £7.9m in the first half of 2019 after falling for ‘romance’ scams.
These happen when victims are conned into sending money to people they have met online and believe they are in a relationship with.
Often the catfish con is developed over a long period of time and involves multiple small payments to the criminal.
Katy Worobec, Managing Director of Economic Crime at UK Finance, said: “Not only does fraud have a devastating impact on victims, the money stolen goes on to line the pockets of organised criminal gangs involved in drugs, arms and human trafficking.
“The finance industry is constantly investing in advanced security systems to protect customers from this threat, while helping law enforcement to apprehend and disrupt the criminals responsible.”
“However, criminals are continuing to exploit vulnerabilities outside the financial sector to obtain customers’ data that is then used to commit fraud.”