New figures show fraudsters directly targeting bank customers

October 2nd 2015

Financial fraud losses rose by 6% in the first half of 2015, according to new figures published today by Financial Fraud Action UK (FFA UK). Fraud losses on payment cards, online and telephone banking and cheques totalled £325.3 million in January to June 2015, up from £307.7 million during the same period in 2014.

The new data shows that:

• Over two-thirds of attempted fraud stopped by banks

• Card fraud losses rise slightly, but fall as a proportion of spending to 4 year low

• Customers urged to be vigilant of scams as online and telephone banking losses rise by 37%

The new data highlights increasing attempts by fraudsters to target individuals directly and the ongoing importance for consumers to be vigilant about scams attempting to steal their personal information.

For the first time FFA UK is publishing the value of prevented fraud. The new figures show that banks’ and card companies’ security systems detected and prevented a total of £910.9 million worth of attempted card, online and telephone banking and cheque fraud from occurring in the first half of 2015 – £7 in every £10 of fraud.

Card fraud

Fraud losses on UK cards totalled £249.9 million during January to June 2015, an increase of 1% on the same period in 2014. Over this period overall card spending has grown substantially, so card fraud as a proportion of card purchases has fallen to 6.9p for every £100 spent, the lowest level since 2011 and down from 7.5p at the end of 2014.

A total of £355.4 million of card fraud was stopped by bank and card company security systems during January to June 2015. This is equivalent to £6 in every £10 of attempted fraud being prevented.

• Losses on purchases made using a card remotely – those made online, over the phone or by mail order – remained flat at £174.4 million. The number of incidents of remote purchase fraud fell by 5%. Contained within this figure, e-commerce card fraud totalled an estimated £109.9 million, also flat compared to 2014. At the same time, online card spending increased by 14.3% to £67.4 billion in the first six months of 2015, up from £59.0 billion in the equivalent period of 2014.

• Card ID theft losses rose to £18.8 million, up by 28% on the first six months of 2014. Card ID theft occurs when a fraudster either sets up a new account in someone else’s name or takes over an existing account using stolen information. A key driver is the rise in scams in which fraudsters target individuals to steal their personal and financial information, which is then used to commit ID theft. Card ID theft represents only 7.5% of all card fraud.

• Overall card fraud losses in the UK fell by 4% to £167.5 million, while overseas losses rose by 14% to £82.4 million. A major factor is criminals using UK cards in overseas countries which do not have the same level of security in place, such as the use of additional passwords for online purchases.

• Fraud on contactless cards remains very low with £516,500 of losses during the first six months of 2015, compared to spending of £2.58 billion over the same period. This is equivalent to 2p in every £100 spent on contactless and represents only 0.2% of all card fraud.

Telephone and online banking fraud

In order to establish consistency across all fraud categories, from this year FFA UK is reporting the gross fraud losses for remote banking (online and telephone banking) and cheques, instead of the net figures as previously published. The gross figures represent the value of fraud including any funds subsequently recovered by a bank and as such provide a clearer indication of the scale of attack seen by the industry.

Total remote banking losses rose by 37% in the first six months of 2015 to £65.9 million. Within the total, telephone banking losses rose by 95% to £14.4 million, which represents 4.4% of total financial fraud. Internet banking losses rose by 27% to £51.2 million. However, a third (£20.6 million) of the losses across all remote banking channels were recovered after the incident.

A total of £293.5 million of attempted remote banking fraud was stopped by bank security systems. This is equivalent to £8 in every £10 of fraud being prevented.

• The increase in remote banking fraud losses is due mainly to the rise in scams aimed at customers, often over the telephone, in which fraudsters attempt to trick victims into revealing personal or financial information, such as passwords or passcodes.

• The scam typically involves the criminal pretending to be calling from a bank, the police or another trusted organisation and claiming that there has been fraud on a customer’s account.

• Consumers are urged to be alert for any unsolicited or suspicious calls, texts or emails and follow the advice in the Joint Declaration of UK Banks, Card Issuers and Building Societies on how to take steps to avoid becoming a victim.

• Criminals also use malware and viruses to steal personal information, such as bank login details, from customers. The stolen information is then used to commit fraud on accounts. Customers are advised to ensure they update their computer security software regularly and to be careful not to open any suspicious links or emails.

Cheque fraud

Cheque fraud losses fell by 21% in the first six months of the year, to £9.5 million. This is the third consecutive year of declining losses and lowest ever total reported for the first six months.

£262.0 million of cheque fraud was prevented by bank monitoring systems. This is equivalent to £9.50 in every £10 of attempted cheque fraud being stopped.

Commenting on the fraud figures, Katy Worobec, Director of Financial Fraud Action UK, said: “Banks use sophisticated security systems to protect their customers, stopping over two-thirds of fraud from occurring. However, the industry is never complacent and banks are continuously improving the tools they use to beat the evolving threat of fraud. Fraudsters are now attempting to trick people into handing over passwords, PINs and passcodes – the keys to the door – so it’s vital that customers safeguard their personal and financial information. Criminals impersonate many different organisations, including banks, the police, government departments and utility companies. That’s why we support calls for a national fraud campaign encompassing all those organisations best placed to help customers.”

Detective Chief Inspector Perry Stokes, Head of the Dedicated Card and Payment Crime Unit, said: “Criminals can be extremely convincing, so it’s really important to be on guard. Be very cautious about giving out your personal information. Remember that people aren’t always who they say they are. Just because someone has a bit of information about you does not mean they are definitely genuine. If you get a call, text or email out of the blue asking for your details or for you to transfer money, then do not respond. Instead report it to your bank straight away.”

Please look around this website for all the information and advice you need on how to safeguard yourself, your family and your workplace from fraud.


By Get Safe Online

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