Banks have called on social media companies to take stronger action against scammers, as new data reveals that fraud losses continue to occur through online platforms. According to UK Finance, criminals stole £571 million through unauthorized and authorized card payment fraud in the first half of this year. This represents a 1.5% decrease compared to the first half of 2023, primarily due to a decline in authorized push payment (APP) fraud.
However, UK Finance highlighted that 72% of APP scams originated on social media sites, with telecommunications networks accounting for 16%. The industry body emphasized that criminals not only exploit these platforms for investment, romance, or purchase scams but also use scam phone calls, text messages, and emails to deceive individuals into revealing personal details and passwords.
UK Finance has urged social media companies, technology firms, and telecommunications sectors to collaborate more closely with them in order to protect the public from fraud. These calls for action come at a time when both the UK government and industry are taking steps towards improving protections for card fraud victims.
The government recently confirmed plans to extend the time period during which payments can be delayed by 72 hours if there are reasonable grounds to suspect fraudulent activity. Additionally, payment providers are now liable for losses up to £85k resulting from APP fraud under new rules introduced by the payments regulator.
While losses due to APP fraud decreased by 11% YoY (£214 million) in H1 of this year with total cases falling by 16%, cases of unauthorized card payment fraud increased. Losses from unauthorized card payments reached £358 million (up 5% YoY), covering various forms such as payment cards, remote banking transactions, and cheques. The number of cases rose by 19% during this period.
UK Finance noted that criminals were employing increasingly sophisticated techniques like social engineering tactics in order to trick customers into revealing their one-time passcodes for fraudulent online transactions. They also took advantage of consumers searching for discounted items on social media platforms; scammers would use stolen card details from legitimate sources while keeping the customer’s payment.
During this same period analyzed by UK Finance data analysts found that banks prevented £711 million worth of unauthorized scam payments. While declines were observed in certain categories like APP thanks largely due investments made by banks along with industry collaboration and education programs according Dan Holmes director at Feedzai software group “increases in unauthorised fraud across multiple channels reminds us that we cannot be complacent.”
