In the first half of 2023, fraudsters stole more than £580mn from UK consumers, new data from UK Finance has shown.
The trade association said more than 116,000 cases of APP, or authorised push payment fraud, were recorded - an increase of 22 per cent.
APP fraud is when someone is tricked into sending money to a criminal posing as a genuine payee.
UK Finance data showed 77 per cent of APP fraud started online while 17 per cent started over the phone.
Ben Donaldson, managing director of economic crime at UK Finance, said: “In addition to the financial losses, these crimes often involve callous manipulation of the victim which can cause psychological and emotional harm.
“Criminals are increasingly using social media, online platforms, texts, phone calls and emails to deceive victims into giving up their personal details and their money.
“The financial services sector continues to lead the fight against these awful crimes.
“We are also currently the only sector that reimburses victims. However, it is impossible to reimburse the human impact of these crimes: we must prevent them from happening in the first place.”
Overall, the amount stolen from consumers and businesses was down by 2 per cent in the first six months of the year and banks managed to prevent a further £651mn of unauthorised fraud through their advanced security systems.
Laura Suter, head of personal finance at AJ Bell, said the “silver lining” of the findings relating to APP fraud was the amount returned to victims in the period.
Suter added: “Ultimately much of this fraud spreads on social media, with the ease of generating accounts and posts meaning scammers can cast their net far wider.
“The speed at which a scammer can contact hundreds of people via social media, in comparison to scams where the fraudster has to call up each individual, means that more people can be targeted.
“These figures all have to be taken with a pinch of salt – as we know that the official fraud stats are the tip of the iceberg when it comes to the true scale of fraud in the UK. So often people feel embarrassed or ashamed of being defrauded and therefore don’t report it, while others assume that nothing can be done to get their money back, so it goes unreported.”
While Martin Cheek, managing director of anti-money laundering company SmartSearch called the latest figures “eyewatering”.
He said: "As the report correctly points out, the financial services sector is at the forefront of anti-fraud efforts, with established collaborations with other sectors, the government, and law enforcement. That said, the fight against these criminal gangs is a collective responsibility that extends to all regulated firms.
“Technology is playing an increasingly vital role in preventing these crimes and the money laundering that is an inevitable consequence of them.
“Regulated firms must continue to invest in electronic verification to help protect their customers from fraud – and themselves from the fines and reputational damage which comes from anti-money laundering breaches.”
tara.o'connor@ft.com
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