Word on the web: UK financial fraud on the rise

Studies show financial fraud rose by a quarter during the first half of 2016, with men over 65 the most likely victims

Investment fraud is on the rise in the UK, according to two studies released this week. Financial Fraud Action UK (FFA UK), the banking industry’s fraud prevention body, has reported that there were more than a million cases of fraud during the first half of this year. 

And a report by Action Fraud, the UK’s national fraud and cyber crime reporting centre, and the City of London Police, shows that investment fraud rose by nearly a tenth during 2015. 

Online attacksThe FFA UK report finds that losses from financial fraud increased to £399.5m during the first half of 2016, writes Stephen Little for The Money Pages website. And £321.5m of the total is losses on card payments – an increase of 31% on 2015’s figure.

The article goes on to say that remote banking losses increased from £66.2m in the first half of 2015 to £70.6m during the same period this year. Little adds: “Scams continue to drive remote banking fraud, with criminals tricking victims into handing over their money or banking details.”

Tony Blake, Senior Fraud Prevention Officer at the Dedicated Card and Payment Crime Unit, is quoted as warning people to take their time when asked for personal details or to transfer money. “A genuine organisation will not mind if you check who you are speaking to, because people are not always who they say they are.”

The Money Pages article

Bolstering systemsRosemary Barnes, writing for the Finance Magnates website, says that the majority of fraud is caught by banks’ security systems; with fraud worth £678.7m prevented during the first half of this year.

However, she quotes FFA UK Director Katy Worobec as saying that while many bank security systems are “robust”, many criminals have started using “scams and exploiting data breaches to con victims out of their personal and security information, as well as money”.

Worobec adds: “The industry takes its responsibility to combat fraud extremely seriously, but banks cannot stop all fraud on their own. It is essential all organisations with a role to play work together to better protect individuals and companies.”

Finance Magnates article

Targeted attacksA separate report published by the City of London Police and Action Fraud shows that investment fraud rose by 9.5% in 2015, and 77% of victims are men over the age of 65. The average loss is £32,000 and most of the victims are located in major cities. 
Llosses from financial fraud during the first half of 2016

Detective Chief Inspector Dave Manley, Head of the City of London Police’s Fraud Squad, said: “Investment fraud continues to be a major threat to individuals in this country and statistics show that those who are over 60 are particularly vulnerable to this type of crime.” 

However, according to Jennie Granger, HMRC’s Director General, losses of £1.3bn were prevented during 2014/2015. “Our work with the City of London Police and partners helps HMRC in its role as an anti-money laundering supervisor to prevent fraudulent activity, protect the public, and bring criminals to justice.”

City of London Corporation report

Seen a blog, news story or discussion online that you think might interest CISI members? Email jules.gray@wardour.co.uk.
Published: 14 Oct 2016
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  • The Review
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