Authorised push payment (APP) fraud losses increased by 39% in 2021, topping £583m, according to the latest figures released by UK Finance.
While unauthorised fraud, where scammers steal a victim’s details to gain access to their finances, fell by 7% compared to 2020, it still cost customers £730.4m in 2021.
Over £1.3bn was reported lost to fraud in 2021, although the banking and finance industry prevented a further £1.4bn being stolen from unauthorised fraud. The industry body, UK Finance, has called for cross-sector action to help curb these worrying fraud trends.
1. Payment card fraud
This is where scammers steal your card information. In 2021, £524.5m was reported stolen from 2,823,202 victims, although the total number of cases had decreased by 7% since 2020.
2. Remote banking
This is where scammers gain access to your account (via online banking, telephone banking, or mobile banking). It saw a 20% increase in the number of cases reported in 2021, with total reported losses of £199.5m. Fraudsters often pose as trusted organisations to trick victims into giving away their personal and financial data, or abuse legitimate tools such as .
3. Investment scams
typically involve dodgy online ads and fake websites, such as the we uncovered in April. Statistics reveal that this type of scam rose by 57% in authorised fraud cases in 2021, with £171.7m stolen from 12,074 victims.
4. Bank and police impersonation scams
5. Other impersonation scams
Events such as the Covid 19 pandemic and rising energy costs have seen scammers regularly and utility companies, we’ve also seen a significant number of scams impersonating delivery companies such as DPD, Evri and Royal Mail. The impersonation of these other bodies saw a 33% increase in the number of cases, with £77.5m lost in 2021.
Most banks are signed up to the Contingent Reimbursement Model code, which protects and reimburses you in cases of . However, reimbursement is dependent on whether banks deem scam victims as blameless, which varies significantly across the industry.
According to UK Finance, the Banking Protocol, which enables staff at banks, building societies and Post Offices to alert the police when they think a customer is being scammed, prevented £60.7m from being stolen in 2021. This was up by 34% compared to 2020.
UK Finance also reported that banks have been working with Ofcom to tackle number spoofing and collaborating with text message providers and law enforcement to block scam text messages, with 2,098 unauthorised sender IDs currently blocked. The industry also helped prevent fraud losses by sharing intelligence on emerging threats, data breaches and compromised card details.
Rocio Concha, Which? Director of Policy and Advocacy said:
‘These latest figures expose the shocking scale at which people are experiencing APP scams, and are even more stark amid the current cost of living crisis. Yet all too often victims face a reimbursement lottery depending on who they bank with.’
'The government has announced its intention to enable mandatory reimbursement for bank transfer victims who are not at fault and this needs to be brought in as soon as possible. The Payment Systems Regulator must be ready to ensure that firms are treating customers fairly and consistently, and prepared to take enforcement action against those who breach the rules.’
To help avoid falling for a scam, here are some of our top tips to watch out for:
This article was corrected on 6 July 2022 to clarify that remote banking is where scammers gain access to your account via online banking, telephone banking and mobile apps.