Fraud losses fall 8% as banking industry clamps down

Losses to unauthorised financial fraud fell by 8% in the first half of 2020 to £374.3m, new figures published by UK Finance have revealed.

The banking body’s half-year fraud report for 2020 showed that the finance industry has prevented £853m of attempted unauthorised fraud over the same period – a figure up 4% on the previous year – as firms continue to invest in advanced security systems to detect and block fraudulent activity.

The total means that almost £7 in every £10 of attempted fraud was blocked in the first half of this year.

UK Finance warned that criminals have been exploiting and adapting to COVID-19 with a growth in fraud and scams that target people online. The figures also indicated that criminals have been turning away from more traditional forms of fraud due to the impact of the pandemic.

Contactless card fraud, which takes place using lost and stolen cards, fell by 20% to £8.2m, the first year-on-year decrease since UK Finance started collecting the data in 2013. Cheque fraud losses also saw a significant fall of 78% to £6.4m, with UK Finance suggesting each slump was likely to have been driven by the reduced amount of face-to-face transactions and cheques during lockdown.

Another £207.8m was lost to authorised push payment (APP) fraud in the first half of 2020, which takes place when a customer is tricked into making a payment to another account that is controlled by a criminal, although UK Finance noted that this figure was in line with losses over the same period last year.

“Criminals have ruthlessly adapted to this pandemic with scams exploiting the rise in people working from home and spending time online,” commented UK Finance managing director of economic crime, Katy Worobec.

“These range from investment scams promoted on social media and search engines to the use of phishing emails and fake websites to harvest people’s data.

“The banking industry is working hard to protect customers from this threat, with almost £7 in £10 of fraud prevented in the first half of this year. But we need the public to remain vigilant against scams and remember that criminals are experts at exploiting events like COVID-19 to impersonate trusted organisations.

“Always take a moment to stop and think before parting with your money or information, and don’t let a criminal rush or panic you into making a decision that you’ll later come to regret.”

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