The UK economy lost £1.17bn to payment fraud in 2024, with a steep increase in unauthorised remote purchases.
Remote purchase fraud, which sees criminals use stolen card details to make unauthorised purchases online, over the phone or through mail order, was reported to have occurred 2.6 million times last year, costing about £400m. These were increases of 22% and 11% respectively.
This type of fraud is known as “unauthorised” because the victim is not approving the payment. Authorised payment fraud occurs when the victim is tricked into paying for something by a fraudster.
Authorised push payment (APP), as this is known, sees criminals use fake websites and emails to trick consumers into authorising payments to them. Because payment is authorised, it bypasses the security systems banks have in place to prevent fraud.
According to UK Finance, in 2024 APP fraud losses fell by 2% to just over £450m with 186,000 cases, a 20% reduction on the previous year.
“This is the lowest figure since 2020 and was driven by a range of factors, including investing in technology that can help identify and flag potentially fraudulent activity, to educating and raising awareness among consumers,” said UK Finance.
Ben Donaldson, managing director of economic crime at UK Finance, said fraud continues to “blight this country”, causing “severe harm to individuals, society and our economy as the stolen money goes to serious organised crime groups, both here and abroad”.
He said despite efforts by the banking sector to protect customers, criminals are finding ways around them. “The financial services industry works tirelessly to protect customers and prevent billions more being stolen by fraudsters, but we know that criminals are always looking for new ways to exploit victims.”
Donaldson called for “a more proactive approach” that would see the public and private sectors working more closely together and using data and intelligence more effectively.
He said there also needs to me more effort from the tech sector to prevent fraudsters using their platforms to initiate frauds. “We also need the technology and telecommunication sectors to step up and fight the fraud originating on their platforms and networks,” he added.
UK Finance, which represents about 300 companies in the UK financial services sector, said 70% of APP fraud cases began on online platforms.
Last month, it was announced that banks and tech firms are coming together in an initiative to share information on fraud to give them visibility of the attacks targeted at customers.
The collaboration is part of Stop Scams UK’s intelligence-sharing pilots, which have brought together banks such as HSBC, NatWest and Santander with tech firms Amazon, Google and Meta.
Mobile telecommunications firm Three, BT, challenger bank Monzo, Lloyds Bank and tech giant Meta are among the members that published the Stop Scams UK joint statement.
The joint statement said: “Through Stop Scams UK, tech, telecoms companies and financial services providers have joined forces to share technology, data and intelligence to combat fraudsters on the platforms where they operate, helping to boost consumer confidence and promote economic growth.”
