The Home Select Affairs Committee Inquiry into Fraud - Which? response 

Which? welcomes this opportunity to respond to the previous Government's Home Select Affairs Committee inquiry into fraud. The Home Affairs Committee launched this inquiry into fraud to address the alarming rise in scams that have cost UK consumers over £1.2bn in 2022. This submission emphasises that the UK is in the depths of a fraud epidemic, urging the Government to make tackling fraud a national priority. It advocates for comprehensive reforms—including improved cross-sector data sharing, stronger regulatory obligations, and streamlined consumer reporting—to disrupt fraud networks and safeguard vulnerable consumers. There has been a continued increase in the number of frauds taking place online, with approximately 43 million UK adult internet users encountering fraud online. 

The Government must make tackling fraud a national priority. Without addressing gaps in regulation, UK citizens will continue to be exposed to fraud. The UK Government’s fraud strategy has the ambition and opportunity to be world-leading in its protection and support for consumers in the fight against fraud. To do so, it must be consistent and authoritative in its approach across all digital sectors.

Prevention 

• Fraudsters lead victims across multiple online channels but gaps in regulation, notably among telcos, Internet Infrastructure Providers (IIPs) and online advertising sectors mean simple data checks aren’t made to prevent fraudsters reaching consumers.  

Reporting 

• Consumer reporting is essential to identify fraudulent activity yet its inconsistency  across sectors makes it difficult for consumers to engage with. While we welcome the Payment Systems Regulator (PSR) proposals for mandatory reimbursement, we are concerned with the recent proposal for an excess on APP scam claims and feel this could also have a negative impact on the intelligence gathered. Government should be the central facilitator to enable sharing intelligence across industry about bad actors, to encourage better tools and processes to disrupt fraudsters.

Recommendations for Government actions to fraud and redress

• Encourage greater industry data sharing by addressing industry’s data protection concerns through improved ICO guidance. 
• Facilitate cross-sector data sharing through the fraud sector charters and other groups such as the online advertising task force. 
• Improve sector prevention processes by allowing appropriate access to additional Government data sources (e.g. HMRC, ICO, Companies House, DWP, etc). 
• The Government’s approach to tackling fraud must address gaps in the telcos and IIP sectors and place legal obligations on them to protect consumers from fraud. 
• Government and the PSR must ensure that the new system of reimbursement is fairer and more effective than the current voluntary Contingent Reimbursement Model (CRM) Code.