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British Banks Warn of Big Increase in Online Scams

British banks report that at the end of last year, there was a significant increase in fraud, most of which is observed in the online space.

British Banks Warn of Big Increase in Online Scams

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Representatives of Barclays say that 77% of fraud cases are recorded in social networks, dating apps, and virtual trading platforms.

TSB states that the increase in the number of cases of fraudulent activity is because the practice of users impersonating other people has spread on a significant scale. Also, representatives of this financial institution talk about fixing a special intensity of fraud in the field of investments and purchases.

On WhatsApp tripled the number of cases in which users impersonate other people, over the past year. The number of fake ads in the Facebook Marketplace doubled over the same period.

Some representatives of the banking industry claim that a significant surge in fraud is being recorded on Meta-owned platforms such as WhatsApp and Facebook.

A Meta employee commented on the above statement, saying that fraudulent activity is a global problem. He also noted that criminals resort to increasingly sophisticated methods of deception, using e-mail, SMS, and offline interaction. A Meta representative said that systems for blocking fraudulent attacks have been implemented on the company’s platforms, and advertisers of financial services are required to pass FCA (Financial Conduct Authority) authorization.

Liz Ziegler, director of fraud prevention at Lloyds Banking Group, says banks are dealing with an epidemic of fraud. She noted that taking into account the fact that 70% of fraud cases begin with interaction on the main technological platforms, the owners of these virtual activity spaces should be responsible for countering crime and correcting the situation of innocent victims.

NatWest Chief Executive Alison Rose told the Treasury Select Committee that three million people were affected by fraud in the UK in 2022. She also reported an 87% increase in crimes in this category. Separately, the executive director of the financial institution noted that 60% of cases of fraudulent activity were recorded in social networks and on technology platforms.

TSB stated that according to the results of its observations, it was recorded that in 60% of cases when sellers allegedly offer goods they do not have, to steal money from users, account for Facebook Marketplace. The bank also revealed that two-thirds of fraud cases related to impersonating another person occurs on WhatsApp. In 2022, the financial institution issued 2,650 refunds for these incidents.

Paul Davis, TSB’s director of fraud prevention, is convinced that the companies that own social networks must urgently clean up their platforms to ensure consumer protection. In his opinion, the time has come for social networks and phone companies to take financial responsibility for the growth of fraud activity.

The latest data from UK Finance shows that 56% of the funds stolen by fraudsters in the first half of last year were returned to the victims.

Many banks, including NatWest, Lloyds, and Barclays, have subscribed to the Conditional Refund Model Code. Under this model, people, if they have become victims of fraud with authorized Push payments (APP) and have acted appropriately, receive their funds back.

TSB claims that it reimburses losses in 97% of fraud cases recorded by a financial institution. The bank is also conducting a campaign to combat criminal activity so that others will follow its example.

Rocio Concha, director of policy and advocacy at consumer group Which? says that statistics show an alarming scale of fraud. He stressed that the bill on Internet security has been going through parliament for more than a year, progress on this issue is too slow, and people are subjected to criminal attacks daily.

As we have reported earlier, Alacriti and Socure Team to Prevent Payment ID Fraud.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.