UK consumers lost £236 million to authorised push payment scams in 2017, the first year that Britain's banks have reported data on the fraudulent activity, in which bank customers are duped into transferring cash to criminal accounts.
The publication of the figures follows a review of the way banks handle APP scams conducted by the Financial Conduct Authority that found banks’ procedures were inconsistent, their existing fraud detection systems could not easily detect APP scams, and they didn’t collect enough data.
Under current regulations, UK consumers have no legal right to claim back money lost to APP crime, a situation which will soon change under a contingent reimbursement model being pushed through by the Payment Systems Regulator.
In total, there were 43,875 reported cases of authorised push payment scams with a total value of £236.0 million. Eighty-eight per cent of this total were retail consumers, losing an average of £2,784, and the remainder were businesses who lost on average £24,355 per case.
On the plus side, financial providers were able to return £60.8 million (26%) of the authorised push payment scam losses in 2017.
Banks and card companies also prevented £1,458.6 million in unauthorised financial fraud last year, equivalent to £2 in every £3 of attempted fraud being stopped, the latest data from UK Finance shows.
While fraud losses on payment cards and cheques saw declines, by eigth percent and 27% respectively, losses due to unauthorised remote banking fraud totalled £156.1 million, a 14% rise on 2016.