More than £1 billion lost to fraud last year
Nearly £1.2 billion was stolen by fraudsters last year, according to the UK Finance’s latest annual fraud report, with scammers using increasingly sophisticated techniques such as AI to persuade consumers to part with their cash.
There were nearly 3m cases of fraud in 2023 in total, the report said, with losses due to unauthorised transactions across payment cards, remote banking and cheques totalling £708.7 million.
Rocio Concha, Which? Director of Policy and Advocacy, said: “This is another shocking set of fraud figures and underlines the huge amount of work the government and businesses in different sectors must do to get a grip on this crisis as a new generation of AI-powered scams emerges.
“The Online Safety Act should finally mean accountability and multi-million pound fines for tech firms that fail to stamp out scams on their platforms - but these companies must act ahead of new rules taking effect, as every day that passes means more lives devastated by fraud.”
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Victims of unauthorised fraud cases are legally protected against losses, but this is not the case where people are tricked into making payments, or pay for goods or services which never materialise. Although some payment service providers voluntarily reimburse those who’ve been deceived into handing over cash, it is not compulsory for them to do so. However, this will change from October this year, following new regulations by the government's payment regulator, which will make it mandatory for UK payment service providers to reimburse victims of this kind of fraud.
Myron Jobson, Senior Personal Finance Analyst, interactive investor, says “In our increasingly digitised world, financial scams are like weeds in a garden; no matter how much we tend to it, they keep popping up, threatening our financial well-being. Common scams such as postage and impersonation scams are becoming increasingly difficult to recognise, because they constantly alter their disguises.
“Unscrupulous criminals will stop at nothing to commit fraud. As such, we all need to remain on our guard and update our idea of what a scam is. Falling victim to financial fraud often has a psychological and emotional impact in addition to financial losses. These can linger and cause distress well after the scam is over.”
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Holiday scams are often rife at this time of year, with many people planning summer breaks. These involve people being tricked into paying for fake flights and accommodation that doesn’t exist. Last year alone there were 6,640 reports of holiday booking-related fraud.
If you are booking a holiday, remember that if a deal seems too good to be true, it usually is. You should also only buy via reputable travel sites or agents and never agree to transfer money directly to someone claiming they are a holiday property owner.
Dennis Pedersen chief executing of PayFasto said: “One way to safely pay online when booking a trip away is to use a credit card. Most major credit card providers protect online purchases and will refund fraudulent transactions in certain circumstances (always check with the card provider).
“Using a credit card also means that if your payment details are stolen, your main current account won’t be affected directly. Other ways to protect your account details online are using Google and Apple Pay and services such as PayPal, as the business then won’t see your details directly.”