trending
APP fraud (Authorised Push Payment) losses continued to be driven by the abuse of online platforms and telecommunications.
Criminals commit investment scams advertised on search engines and social media, romance scams via online dating platforms and purchase scams promoted through social media and auction websites.
Criminals also use scam phone calls, text messages and emails to trick people into handing over personal details and passwords, using this information to convince people into authorising a payment.
Typically, criminals first focus their attempts on socially engineering personal information from their victims with a view to committing APP fraud in which the victim makes the payment themselves.
If this is not successful, the criminal often has enough personal information to enable them instead to impersonate their victims, with a view to either taking control of their existing accounts or applying for credit cards in their name.
UK Finance data shows:
- 77% of APP fraud cases originated from online sources. These cases tend to include be lower-value scams, such as purchase scams, and so account for 32% of total losses.
- 17% of cases originated in telecommunications and these tend to include higher value cases, such as impersonation fraud, and so account for 45% of total losses.
Unauthorised fraud losses
Losses due to unauthorised transactions across payment cards, remote banking and cheques were £340.7 million in the first half of this year, down 3% on the same period in 2022.
The total number of recorded cases was 1.26 million, down 10%.
Victims of unauthorised fraud cases such as these are legally protected against losses.
And UK Finance research indicates that customers are fully refunded in more than 98% of unauthorised fraud cases.
Remote purchase, or card not present fraud, remained the biggest single category of losses here, although there was a 12% reduction to £173.8 million and a 14% reduction in case numbers.
The level of losses was the lowest total reported for eight years (since 2015), driven by measures such as Strong Customer Authentication and one-time passcodes (OTPs).
There was a notable increase in card ID theft losses, which were up 57% to £33.1 million.
Where criminals are unable to socially engineer their victims into making authorised push payments, they use the personal information gathered as well as stolen card details to either take over existing accounts or apply for new credit cards.
There was a 10% increase in the amount of unauthorised fraud prevented, up to £650.7 million.
Authorised Push Payment fraud losses
Authorised push payment (APP) fraud losses were £239.3 million, down 1% compared to last year. This comprised £196.7 million of personal losses and £42.6 million of business losses.
The total number of APP cases was up 22% to 116,324. The main driver behind this is purchase scams, where people are tricked into paying for goods that never materialise.
The total number of these cases rose 43% to just under 77,000 and accounts for two thirds of all APP cases, while the amount lost rose 31% to £40.9 million.
The number of romance scams, where victims are tricked into believing they are in a relationship, rose by 29% and the amount lost to this kind of fraud rose by 26% to £18.5 million.
The number of fraud cases where criminals impersonate a bank or the police and convince someone to transfer money to a “safe account” fell by 35% and the amount lost to this type of fraud fell by 27%.
There has been significant investment made in warning consumers that a bank will never ask someone to transfer money in this way.
In total £152.8 million of APP losses was returned to victims in H1 2023 or 64% of the total loss. This has increased by 13% from £135.6 million in H1 2022.
Comments