Bank cons costing us £1m a day

BRITAIN’S fraud epidemic is growing at an alarming pace – despite repeated promises by banks to act, shocking figures reveal.

Bank scam victims lost £207.5million in the first six months of this year – more than £1.1 million a day.

A total of 57,549 cases of ‘authorised push payment scams’ were recorded by banks – an astonishing 69 per cent rise compared with the same period in 2018, according to trade body UK Finance.

But only £39.3million was refunded, with the banks

blaming victims of the scammers for approving the payments.

Politicians and consumer champions last night accused banks of failing to do enough to protect customers and called for urgent action to stop victims losing their savings.

Other types of fraud are also on the rise, including cheque fraud, where losses were more than eight times higher compared to the first six months of last year.

Labour MP Catherine McKinnell, interim chairman of the Treasury select committee, said: ‘Today’s fraud figures show there is still much to do to protect consumers from ever-more sophisticated scammers, with more safeguards needed.’

Money Mail raised concerns about rocketing fraud figures in September last year, prompting the launch of this paper’s Stop the Bank Scammers campaign.

In May, rules were introduced to ensure victims are treated fairly and refunded, providing they have taken reasonable care to protect themselves. But the new figures reveal that in the run-up to the new code of conduct, banks actually cut back on the amount of money they returned to victims.

In the second half of last year, banks paid back £51.7 million, compared to the £39.3 million in the first six months of 2019 – a fall of 24 per cent.

The UK Finance report breaks down how much money was lost to different types of fraud.

Investment scams accounted for the largest proportion of losses – a total of £43.4 million, twice the amount lost in the same period in 2018. The average victim, who is typically tricked into transferring money into funds or investments that don’t exist, lost £12,200. Only £2.9 million of this was refunded.

More than a quarter of all authorised push payment scam losses were the result of invoice and mandate fraud. This is where criminals pose as solicitors or builders, for example, and intercept invoices sent to customers via email so they can swap the bank details for their own.

The number of impersonation scam reports also doubled compared to the first six months of 2018. Earlier this month, TV presenter Helen Skelton was conned out of £70,000 by telephone scammers claiming to be from her bank.

UK Finance blamed the rise in fraud on data breaches and theft of personal information.

But Martyn James, of complaints website Resolver, said: ‘Banks are supposed to be the gatekeepers to our cash and they are fundamentally failing in the battle against fraudsters. They, the police and the Government must do more to pursue and investigate these criminals.’

So far only eight banking groups have committed to the new code of conduct launched in May, with many smaller firms yet to sign up.

Which? money editor Jenny Ross said: ‘The alarming rise of bank transfer fraud shows why the new banking industry code is so important and must deliver results.’

Katy Worobec, managing director of economic crime at UK Finance, said: ‘A new voluntary code was introduced in May that has significantly improved consumer protections from authorised push payment fraud. However, criminals are continuing to exploit vulnerabilities outside the financial sector to obtain customers’ data that is then used to commit fraud.

‘We all have a responsibility to work together, including online retailers and social media companies, to beat the fraudsters and keep customers’ data secure.’

UK Finance added that the figures year-on-year were not directly comparable because more banks are reporting fraud figures.

The findings follow an undercover probe into national cybercrime and fraud reporting service, Action Fraud, which revealed the helpline was failing to properly investigate victims’ cases.

Action Fraud said it was investigating the claims.

‘Keep customers’ data secure’