September 28, 2017

Latest industry data shows fall in financial fraud

  • Total losses on card, remote banking and cheque fraud were 8 per cent lower in H1 2017 than in H1 2016
  • Industry successfully stopped more than two-thirds of attempted financial fraud preventing over £750 million of fraud
  • Banking industry and government to launch next phase of Take Five to Stop Fraud campaign to help customers spot the most common financial scams as criminals increasingly target them as the weakest link

Financial fraud losses of £366.4 million in the first half of 2017 were 8 per cent lower year-on-year, figures from UK Finance show. The data, which covers payment cards, remote banking and cheques, also shows that the industry prevented over £750 million of fraud during the same period, or 67 per cent of attempted fraud. This compares with £400.4 million of losses and £678.7 million of prevented fraud in the first half of 2016.

Fraudsters are increasingly trying to use customers’ compromised personal and financial information to carry out fraud. Details are primarily stolen through online attacks, such as data hacks and malware, as well as through impersonation scams directly targeting customers.

The new data comes as the banking industry and government join forces to launch the next phase of Take Five to Stop Fraud – the national campaign that offers advice to help customers protect themselves from fraud. Launching on Monday 2 October 2017, the campaign is focused on helping customers to recognise scams and confidently challenge any requests for their personal or financial details by remembering the phrase ‘My money? My info? I don’t think so’.

Data for January to June 2017 shows:

  • The industry helped prevent over £500 million in attempted card fraud. Actual fraud losses on cards were down 11 per cent on the same period the year before – to £287.3 million.
  • Card spending increased by 8.4 per cent year-on-year across the six-month period, meaning card fraud as a proportion of spending equates to 7.5p for every £100 spent, down from 8.7p in the first half of 2016. It peaked in February 2002 when it was 18.9p per £100.
  • £160.2 million of remote banking fraud was prevented. Remote banking fraud totalled £73.8 million, a 3 per cent rise from £71.5 million in the same period in 2016. This covers criminals gaining access to an internet, phone or mobile banking account to make an unauthorised transaction.
  • £88.8 million of cheque fraud was prevented. Cheque fraud losses fell to £5.3 million, a 28 per cent drop on the same period in 2016. This is the lowest half year total on record.
  • There were 937,518 cases of financial fraud, a figure that has remained stable compared with the same period the year before.

Katy Worobec, Head of Fraud and Financial Crime Prevention, Cyber and Data Sharing at UK Finance, said:

“Tackling fraud is a top priority for the entire industry. But financial fraud is not just an issue for the banking sector – its harmful effects stretch far and wide. This is why when it comes to prevention, protection or deterrents the industry is committed to taking a collaborative approach to curb these crimes and is launching the latest Take Five consumer campaign. Whether it’s banks refining their own security systems or a retailer holding customer data securely, everyone has a part to play.

“Next week our Take Five to Stop Fraud campaign in partnership with the Home Office kicks off to make sure customers know what to do to stay safe from the latest scams. Through the campaign we want to encourage all customers to remember to Take Five by saying ‘My money? My info? I don’t think so’.”

Security Minister Ben Wallace said:

“Any signal that fewer people are falling victim to financial fraud is very good news. However, we know that fraud remains a widespread problem and there is more to be done to prevent criminals from ruthlessly targeting people and businesses for their hard-earned money.

“The Joint Fraud Taskforce sees Government, law enforcement and industry working together to tackle some of the toughest fraud issues in order to protect the public. The national Take Five campaign will raise further awareness of how people can take simple steps to protect themselves against scams.”

Criminals are increasingly using sophisticated impersonation scams to trick customers into giving away their personal or security data. In these scams fraudsters contact customers by phone, email or text pretending to represent a trusted organisation asking for information. Often the fraudster will seem very convincing and claim there has been suspicious activity on an account, account details need to be ‘updated’ or ‘verified’, or a refund is due.

A fraud then happens in one of two ways. The stolen data is either used by criminals to access customer accounts and withdraw money or to make card payments, or they try to trick customers into transferring money directly to them, for instance through investment or invoice fraud scams.

The industry has been collating data on losses resulting from customers authorising a transfer themselves and UK Finance will be publishing separate data later this autumn.

The finance industry is responding to the ongoing threat of all types of fraud by:

  • further investment in the Take Five to Stop Fraud campaign, with the Home Office, to raise awareness of fraud and how customers can protect themselves. The central Take Five campaign is being backed by financial providers’ own fraud awareness campaigns;
  • working with law enforcement and government through the Joint Fraud Taskforce to use our collective powers to combat fraud and protect customers;
  • fully sponsoring a dedicated police unit which targets the criminals responsible for fraud;
  • introducing new banking procedures* between police and bank branches to prevent vulnerable people from falling victim to fraud;
  • exploring new ways to track stolen funds moved between multiple bank accounts, and creating new guidelines setting out how customers reporting cases of fraud are handled;
  • sharing intelligence about the latest threats through FFA UK’s fraud intelligence hub;
  • calling for new powers on information sharing to allow banks to share data to detect and prevent financial crime better; and
  • ongoing refinement of banks’ own in-house fraud prevention systems.

The Take Five to Stop Fraud campaign is backed by financial providers across the industry. The campaign encourages everyone to question uninvited approaches and never give out personal or financial details. Customers can expect to see and hear Take Five ‘My money? My info? I don’t think so’ across a wide range of media including radio and online over the coming months.

Tony Blake, Senior Fraud Prevention Officer at the Dedicated Card and Payment Crime Unit, the industry sponsored specialist police unit, said:

“Fraudsters will do all they can to appear like the real deal, so always be on your guard for any calls, texts or emails out of the blue asking for your details. They may even be able to quote some basic information about you. Stop and think before you give away any information and if you are the slightest bit unsure then hang up and don’t reply. Instead contact the organisation directly on a number you trust, such as the one on their official website.”

Take Five urges customers to help stay safe from fraud by following simple advice:

  • A genuine bank or organisation will never contact you asking for your PIN, full password or to move money to a safe account.
  • Never give out personal or financial information. Always contact the company directly using a known email or phone number.
  • Don’t be tricked into giving a fraudster access to your details. Never automatically click on a link in an unexpected email or text.
  • Always question uninvited approaches, in case it’s a scam.

Ends

For further information please contact:

Giles Mason: 020 3934 1328 / 07442 497 955 / giles.mason@ukfinance.org.uk
The UK Finance press office: 020 7416 6750

Notes to Editors

1. The full set of financial fraud data for January to June 2017, including breakdowns by fraud type, is available at http://www.ukfinance.org.uk/wp-content/uploads/2017/09/2017-half-year-fraud-update_September-17_27th.pdf.

2. Take Five to Stop Fraud is the national fraud campaign developed by the industry and now working in partnership with the Home Office to offer straight-forward and impartial advice to help everyone protect themselves from preventable financial fraud. A preview of the campaign materials which launches on Monday 2 October 2017 and includes an advert which will be screened on-demand through Sky, All 4 and ITV Hub amongst other places, is available at https://takefive-stopfraud.org.uk/toolkit/videos/ and https://takefive-stopfraud.org.uk/toolkit/press-releases/. The campaign covers email deception and phone-based scams as well as online fraud – particularly where criminals impersonate trusted organisations. It is being delivered with and through a range of partners including financial services firms, law enforcement agencies, businesses and other key stakeholders. https://takefive-stopfraud.org.uk/

3. Phase two of Take Five to Stop Fraud will focus on three common scams, planned for different times during the campaign:

  • Requests to move money (October): This is when you’re asked to move money into a new account. A genuine bank or organisation will never tell you to do this, or ask for your PIN or full password. Don’t give personal or financial details.
  • Dodgy links (November): If you click on links or open files in an unexpected email or text, you could be giving a fraudster access to your personal or financial details. Never automatically click on these.
  • Requests for information (January): Question uninvited approaches and never give out personal or financial details, in case it’s a scam. Contact the company directly using a known email or phone number

4. UK Finance is a new trade association which was formed on 1 July 2017 to represent the finance and banking industry operating in the UK. It represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation brings together activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.

5. As a constituent part of UK Finance, Financial Fraud Action UK is responsible for leading the collective fight against financial fraud on behalf of the UK payments industry. Our members include banks, credit, debit and charge card issuers, and card payment acquirers in the UK.

6. The Dedicated Card and Payment Crime Unit (DCPCU) is a unique pro-active police unit, with a national remit, formed as a partnership between Financial Fraud Action UK, the City of London Police and the Metropolitan Police together with the Home Office. It is fully sponsored by the cards and banking industries, with an on-going brief to investigate, target and, where appropriate, arrest and seek successful prosecution of offenders responsible for card, cheque and payment fraud crimes. It is headed up by a Detective Chief Inspector and comprises officers from the Metropolitan and City of London police forces who work alongside banking industry fraud investigators and support staff.

*The industry’s National Banking Protocol developed by FFA UK and its members won an Outstanding Collaboration award in this year’s Annual Government Counter Fraud Awards. Launched last October, the initiative is a collaboration with National Trading Standards and Metropolitan Police to ensure banks and police are more active in protecting customers. It has already saved over £6m for potential victims, many of whom are elderly and vulnerable.