Year-on-year fraud losses increase in 2021 | moneyfacts.co.uk

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Michael Brown

Content Writer
Published: 04/07/2022

In addition, a further £1.4 billion worth of fraud was prevented by banks and card companies.

Over £1.3 billion was stolen by criminals through authorised and unauthorised fraud last year, according to UK Finance. Compared to 2020, this was an increase of over £400 million.

Of this £1.3 billion, over £730 million was lost to authorised fraud, where the account holder is tricked into approving a payment to an account controlled by the criminal.

“Authorised fraud losses rose again this year as criminals targeted people through a variety of sophisticated scams, with much of the criminal activity taking place outside the banking sector, often involving online and technology platforms,” said Katy Worobec, Managing Director of Economic Crime at UK Finance.

Conversely, the rest of this figure was classified as unauthorised fraud, where the account holder does not provide authorisation for the scam.

“Unauthorised fraud losses fell last year, but this type of criminal activity remains a major problem,” said Worobec.

Is fraud being stopped?

In addition to these figures, banks and card companies stopped £1.4 billion worth of unauthorised fraud during last year.

It means, according to UK Finance, 65.3p of every £1 in fraud is being stopped.

“Through the introduction of new measures such as strong customer authentication, coupled with continued investment in technology, the banking and finance industry prevents significant amounts of fraud from taking place,” Worobec explained.

Still, in the previous year, banks and card companies prevented £1.6 billion in unauthorised fraud. This equates to stopping 67.3p per £1 of fraud attempted during 2020.

APP fraud on the rise

Authorised Push Payment (APP) fraud, a type of authorised fraud, saw an increase in volume and value last year.

More than £583 million was lost to this type of fraud, almost a 40% increase when compared to the prior year.

 In total, there were almost 196,000 incidents of APP, a 27% increase on the previous year.

“Using tactics such as scam phone calls, text messages and emails, as well as fake websites and social media posts, criminals seek to trick people into handing over personal details and passwords,” the report stated.

“This information is then used to target victims and convince them to authorise payments. The majority of authorised push payment fraud starts online,” it continued.

How can I protect myself against fraud?

Last week, our financial partners Kellands Hale discussed some of the means consumers can take to protect themselves from financial scams.

More information on this can be found here.

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