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Taking on the fraudsters


Katy Worobec

Managing Director of Economic Crime, UK Finance

Criminals stole over £503 million through fraud and scams in the first six months of this year. Over £145m of which was down to bank transfer frauds (also known as push payment scams), where criminals dupe customers into making a payment to a fraudulent account.

It can all happen via a simple phone call, text message or email, but the consequences can be severe.

These banking fraudsters  are becoming increasingly professional, frequently using a tactic known as social engineering to manipulate people into divulging their personal or financial details or transferring money.

A typical ploy might be impersonating trusted organisations – such as a bank, the police, a utility company or a government department. The criminal will call, text and email, to try to trick their victim into acting. Often they will have done their homework first, so can they quote information about their target in a bid to appear genuine.

Cover stories used by banking scammers can vary widely. They might pose as a member of bank staff or a police officer and claim they have spotted fraud and that money needs to be transferred to a ‘safe account’. They might offer tempting deals online for goods that don’t actually exist, email a fake invoice to a business or cold-call with a fraudulent investment opportunity.

Stop and think about the credibility of the call

One common thing the fraudsters use is pressure. “Act now or your money is at risk”. “Invest now to secure a great deal”. “Update your details now or your account will be closed”. It’s all an attempt to panic people into responding. And when people panic, their normal, rational judgement can go out the window.

That’s where the Take Five to Stop Fraud campaign comes in. The campaign urges everyone to stop and think whenever they get a call, text or email out of the blue asking for their personal or financial details, or to transfer money.

Even if they say they’re from the bank or the police, it’s still important to take a moment to reflect and step back from the situation. As a nation, we’re all, understandably, trusting. So, it’s important to take control and remember that it’s fine to refuse requests for personal information. Just hang up the phone, delete the email and don’t reply to the text message.

Banks prevented over £705 million in fraud this year

But you aren’t alone – the finance industry takes the threat from fraud and scams extremely seriously. Banks invest millions in security systems and cyber defences to protect customers – stopping over £705 million in fraud in the first half of this year – and they work closely with the police to disrupt criminals and freeze stolen money.

New standards have also been introduced to make sure scam victims get the help they need from their payments provider and we are helping the government improve how intelligence is shared. Because, by working together, we can all beat the fraudsters.

Impersonation scam – Bank/Police – total losses £22.2m (January to June 2018)

In these scams, the criminal claims to be from either the police or the victim’s bank and convinces the victim to make a payment. Often, the fraudster says there has been fraud spotted on an account and the victim need to transfer money to a ‘safe account’ to protect it.

Impersonation scam – Other – total losses £14.4m (January to June 2018)

Here, the criminal usually claims they are from an organisation such as a utility company, a communications service provider or a government department and says the victim must settle a fictitious fine or return an erroneous refund.

Investment scams – total losses £20.9m (January to June 2018)

With an enticing claim of high returns, the criminal convinces their victim to send money to a fictitious fund or to pay for a fake investment. These scams include investment in items such as gold, property, carbon credits, land banks and wine.

Purchase scams – total losses £19.4m (January to June 2018)

These scams often happen online, through auction websites or social media. Spotting a tempting deal, the victim pays in advance for goods or services that are never received. It might be a car or a technology product, such as a phone or computer, advertised at a low price to attract buyers. Or it can be a fake holiday rental or concert tickets that don’t exist. While many online platforms offer secure payment options, the criminal persuades their victim to pay via a bank transfer instead.

Romance scams – total losses £5.3m (January to June 2018)

In a romance scam, someone is convinced to send money to a person they have met, often online, and with whom they believe they are in a relationship. These relationships are usually built up over a long period of time.

Advance fee scams – total losses £6.0m (January to June 2018)

These scams include the criminal convincing someone they have won an overseas lottery, or that gold or jewellery is being held at customs, and a fee must be paid to release the funds or goods.

Invoice and mandate scams – total losses £49.3m (January to June 2018)

Here, the victim attempts to pay an invoice to a legitimate payee, but the scammer intervenes to convince them to send the payment to the scammer’s account instead. These scams include criminals targeting consumers posing as conveyancing solicitors, builders and other tradespeople.

CEO fraud – total losses £8.0m (January to June 2018)

This type of scam mainly targets businesses and happens when the scammer impersonates a CEO and convinces a company to redirect a payment to the scammer’s account.

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