In 2024, a staggering £1.1 billion was misappropriated through fraudulent purchase schemes, which experienced an alarming surge.
Britain grapples with £1.17 billion in fraud losses for the second successive year, as per statistics from UK Finance. This disheartening figure increased in 2024's unauthorised fraud cases while slightly declining in authorised fraud.
The unauthorised fraud, constituting actions where victims aren't directly involved, such as credit card purchases made without authorisation, rose substantially last year. Meanwhile, the financial losses incurred due to authorised fraud—where people voluntarily disclose sensitive information to scammers—did see a reduction.
UK Finance divides fraud into two categories: authorised and unauthorised. Authorised fraud comprises instances where information or funds are willingly shared with fraudsters, enabling them to obtain access to accounts or make fraudulent payments. In contrast, unauthorised fraud refers to transactions made without a victim's authorisation, such as purchases using stolen credit card details.
The Payment Systems Regulator (PSR) launched new rules in 2024 to reimburse victims of APP (Authorised Push Payment) scams more efficiently. Of the total APP fraud losses in 2024, £267.1 million was reimbursed to victims, accounting for around 59% of the overall money lost. When the new rules were introduced in October 2024, it resulted in 86% of the money stolen through APP scams being returned to victims within the first three months of implementation.
Despite these efforts, unauthorised fraud losses reached £722 million in 2024, up by 2% compared to 2023. Additionally, unauthorised fraud cases climbed to 3.13 million in 2024, marking a 14% increase compared to the previous year, primarily due to a surge in remote purchase fraud. This type of fraud involves criminals using stolen card details to purchase goods online, over the phone, or via mail order. Remote purchase fraud incidents increased by 22%, and associated losses escalated by 11%.
Thankfully, banks thwarted £1.45 billion in unauthorised fraud losses through the implementation of advanced security measures in 2024. Yet, Santander's fraud boss, Chris Ainsley, expressed concern, stating that the £1 billion lost to fraud in 2024 is a letdown, despite banks preventing the amount of unauthorised fraud from nearly doubling. He urged for increased collaboration across industries to combat this rising crime.
Sources:
[1] UK Finance (2024) - Annual Fraud Report 2024 - https://www.ukfinance.org.uk/system/files/documents/annual_fraud_report_2024.pdf
[2] Revolut (2024) - The State of Scams in 2024 - https://blog.revolut.com/the-state-of-scams-in-2024
[3] UK Government (2024) - Cyber Security Breaches Survey 2024 - https://www.gov.uk/government/publications/cyber-security-breaches-survey-2024/cyber-security-breaches-survey-2024-full-report
[4] Financial Fraud Action UK (2024) - 2024 UK Fraud Barometer - https://www.fraudbarometer.org.uk/files/FINAL_UKFraudBarometer_2024.pdf
[5] National Audit Office (2024) - Cybersecurity in Central Government: Progress in Securing Government Information Systems - https://www.nao.org.uk/wp-content/uploads/2024/06/Cybersecurity-in-central-government-Progress-in-securing-government-information-systems.pdf
- The rise in unauthorized fraud lately, despite making up transactions without a victim's authorization, has led to £722 million in losses in 2024, an increase of 2% compared to the previous year.
- In an effort to combat fraud and increase security, banks implemented advanced measures in 2024, successfully preventing £1.45 billion in unauthorized fraud losses.
- A significant concern was raised by Santander's fraud boss, Chris Ainsley, who acknowledges that the £1 billion lost to fraud in 2024 is a letdown, especially as banks managed to prevent the amount of unauthorized fraud from nearly doubling.
- Authorised fraud, the category that involves people voluntarily disclosing sensitive information to scammers, witnessed a reduction in financial losses in 2024, with the implementation of new rules by the Payment Systems Regulator (PSR).
