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  1. ITV Report

Banks urged to ‘step up’ as fraudsters steal £500m from UK customers

Criminals stole £500 million through fraud and scams in the first half of 2018 Photo: PA Archive/PA Images

Scammers stole more than half a billion pounds from UK bank customers in the first half of 2018, figures show.

A total of £145 million of that was lost through authorised push payment (APP) scams, with the rest lost due to unauthorised fraud, trade body UK Finance said.

  • What is an APP scam?

An authorised push payment scam is where people are duped into authorising a payment to another account.

UK Finance said £30.9 million of the £145 million lost through APP scams this year had been returned to customers.

The most prevalent type of APP scams – accounting for almost two-thirds of reported cases in the first six months of the year – were purchase scams, where victims pay in advance for a product or service, such as a car or a holiday rental, which is not received or does not exist.

This type of fraud often takes place online, through auction websites or social media.

There were also 3,866 reported cases of impersonation scams, where the criminal claims to be from the police, bank or another organisation in order to trick the victim into transferring money.

The nature of these scams means victims are often persuaded to transfer significant sums of money, with the average loss in police and bank impersonation fraud amounting to £11,402.

  • What about unauthorised fraud?

This is where the transaction is carried out by a third party and is not authorised by the account holder.

Around £358 million was lost in the first half of this year, UK Finance said.

In most cases, victims of unauthorised fraud receive a full refund, but those duped by APP scams currently have no legal protection to cover them for losses.

An authorised push payment scam is where people are duped into authorising a payment to another account. Credit: PA

Katy Worobec, managing director of economic crime at UK Finance, said the figures showed scams posed a “major threat” to the UK.

“The criminals behind it target their victims indiscriminately and the proceeds go on to fund terrorism, people smuggling and drug trafficking, whether or not the individual is refunded,” she said.

  • What are banks doing to protect customers' money?

Katy Worobec says the industry was taking action to tackle the problem, by investing in security systems and cyber defences, as well as bringing in new standards to ensure victims get support from their payment providers.

UK Finance said financial institutions had prevented two-thirds of unauthorised fraud in the first half of 2018.

But Gareth Shaw, money expert at consumer group Which?, said banks’ efforts had been “woefully insufficient”.

It’s now two years since our super-complaint highlighted the lack of protection for victims of bank transfer scams, but these shocking figures show just how widespread the problem still is,” he said.

Banks… have not done enough to protect their customers, who continue to lose life-changing sums of money to ever-more sophisticated crooks.

The Payment Systems Regulator has rightly committed to introducing a reimbursement scheme for victims. It’s about time that banks step up and properly compensate customers who have lost money through no fault of their own.

– Gareth Shaw, money expert at Which?
  • How can you protect yourself from these scams?

Action Fraud, the UK's national reporting centre for fraud says you should not give any personal details to anyone without verifying their identity first.

Watch out for phishing emails - "banks and financial institutions will not send you an email asking you to click on a link and confirm your bank details", says the Action Fraud website.

If in doubt, call your bank using a phone number on their official website or a piece of official correspondence.

  • What to do if you are a victim of fraud

Contact Action Fraud on 0300 123 2040 or via their website.

If debit or credit cards, online banking or cheques are involved, your first step should be to contact your bank or credit card company.

More information is available at www.actionfraud.police.uk