UK Financial Fraud Costs £1.2 bn, Although APP Losses Are Down

In 2022, financial crime losses in the UK went down slightly, to £1.2 billion. This was due to a 17% drop in authorised push payment (APP) losses.

Fraud losses in 2022 were 8% lower than in 2021, according to data from UK Finance. The total number of cases in the UK dropped by 4%, to almost 3 million.

In 2022, fraud losses from payment cards, online banking, and checks added up to £726.9 million, which was a decline of less than 1%.

But APP theft, which rose by 39% to £583.2 million in 2021, went back down to £485.2 million the following year. 57% of all recorded cases were about purchase fraud, which was the first time the number of cases went over 100,000.

Even though it was 34% less than in 2021, investment fraud was still one of the biggest reasons for APP loses at 24%. Overall, the amount paid out to cover APP fraud costs went up by 5% in 2022 compared to the year before.

UK Finance has also looked at more than 59,000 cases of APP scams to find the sources. More than three quarters of cases started online. These cases usually involve lower-value fraud, like purchase fraud, and are responsible for 36% of losses. Most cases of online scams happen on social media sites, which account for about three quarters of all cases.

On the other hand, 18% of fraud cases start with telecommunications. These are usually more expensive cases, like identity fraud, and cause 44% of losses.

The financial services industry has been complaining for a long time that social media and telecommunications companies don’t have to pay victims of financial theft. They want the government’s “Online Harms” bill to include online scams.

This week, the business banking platform Tide asked the government to put a tax on social media and telecommunications companies to pay for and train more police officers to fight what it calls the “fraud epidemic” in Britain.

David Postings, CEO of UK Finance, said:

“The banking and finance sector is at the forefront of efforts to tackle this criminal activity. The sector spends billions on detection and prevention and also refunds people who have fallen victim, even if the fraud originated outside the banking system.

Our data also makes clear just how much fraud emanates from online platforms and through telecommunications. The government’s new fraud strategy rightly says we need to focus on stopping it at source and that these other sectors need to do far more to tackle the problem they are facilitating.”