Bank customers lost over £500 million to fraudsters in just six months - here's how you can stay safe

Published by Stephen Little on 25 September 2018.
Last updated on 25 September 2018

Fraudsters stole over £500 million from UK bank customers during the first half of 2018, new figures show.

A total of £145.4 million was lost due to authorised push payment scams, where people are tricked into authorising a payment into another account, according to banking trade body UK Finance.

The remaining £358 million was due to unauthorised fraud, where the transaction is carried out by a third-party without authorisation from the account holder.

In most cases, victims of unauthorised fraud receive a full refund, however, those who have lost money due to an authorised push scam do not receive the same protection.

UK Finance says financial providers were able to return a total of £30.9 million of the £145.4 million lost through authorised push payment scams.

The most prevalent authorised push payment scams in the first half of 2018 were purchase scams, accounting for almost two-thirds of reported 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. This type of fraud often takes place online through auction websites or social media.

There were 3,866 reported cases of impersonation scams, where the criminal purports to be from an organisation such as the police, a utility company or a bank 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 of £11,402.

Katy Worobec, managing director of economic crime at UK Finance, warns the scams pose a major threat to the UK.

She says: “The criminals behind it target their victims indiscriminately and the proceeds go on to fund terrorism, people smuggling and drug trafficking, whether or not the individual is refunded. Every part of society must help to stamp out this menace, especially by stopping the data breaches which increasingly are fuelling fraud.

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

Criminal gangs

UK Finance says fraud is being driven by organised crime who are making millions of pounds, which in turn funds the illegal drug trade, terrorism and human trafficking.

Tony Blake, head of fraud prevention at Dedicated Card and Payment Crime Unit, a specialist police squad, says: “Criminals are after your money and they are clever at getting it, impersonating people and organisations to groom even the savviest into acting.”

He says that if you get a call, text, email or social media message asking for personal or financial details or to transfer money, it is probably a scam.

He adds: “Check every request is genuine by doing some research and contact the organisation using the details from their official website, a latest bill or statement.”

To stay safe, customers are urged to follow the advice of the Take Five to Stop Fraud campaign:

  • A genuine bank or organisation will never contact you out of the blue to ask for your PIN, full password or to move money to another account. Only give out your personal or financial details to use a service that you have given your consent to, that you trust and that you are expecting to be contacted by.

  • Don’t be tricked into giving a fraudster access to your personal or financial details. Never automatically click on a link in an unexpected email or text.

  • Always question uninvited approaches in case it’s a scam. Instead, contact the company directly using a known email or phone number.

Source: UK Finance

Leave a comment

I wish I knew what I know now

I wish I knew what I know now but in 2005/2006 there was not much information available. I now know I was one of many who trusted persons on the phone offering shares in U.S firms and Brazil. I lost in the region of 55K to banks in USA, Cyprus and Switzerland through NatWest money transfers .It took a long time to admit I was a complete trusting fool but my wife stood by me and managed to pull me from a very dark place but it was touch and go for a while. Not blaming anybody but myself.