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June 30, 2022

UK bank customers lost £1.3bn to fraud and scams in 2021

Figures published by trade body UK Finance revealed that criminals stole more than £1.3bn in 2021 from UK bank customers through fraud and scams.

According to the report, unauthorised fraud, where the transaction is carried out by the criminal without the customer’s knowledge or consent, resulted in a loss of £730.4m.

While losses from authorised push payment (APP) fraud, where the customer is tricked into authorising a transaction, amounted to £583.2m in 2021, a surge of 39% compared with 2020.

Unauthorised financial fraud losses from payment cards, remote banking and cheques saw a decline of 7% in 2021 compared with 2020.

Notably, unauthorised payment card fraud victims are legally entitled to compensation and according to the industry analysis, in over 98% of all confirmed cases, customers are refunded.

In 2021, there were 195,996 cases of APP scams and £271.2m or 47 % of losses were returned to victims.

The breakdown of the report shows customers lost £214.8m to impersonation scams, which was the largest category of APP losses.

It was followed by investment scams, which amounted to £171.7m. Purchase scams were the most common with losses standing at £64.1m.

The report also shows that the banking and finance industry managed to prevent unauthorised fraud worth £1.4bn.

Furthermore, UK Finance has urged a greater cross-sector action to tackle the problem of fraud.

UK Finance managing director of economic crime Katy Worobec said: “Unauthorised fraud losses fell last year, but this type of criminal activity remains a major problem.

“Authorised fraud losses rose again this year as criminals targeted people through a variety of sophisticated scams, with much of the criminal activity taking place outside the banking sector, often involving online and technology platforms.”

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