The Covid-19 pandemic has sparked a significant rise in fraud to the point that it now arguably poses a national security threat. The Banking and Finance industry is calling for Government-coordinated action across all sectors to tackle the issue and request that all economic crime is brought within the scope of the Online Safety Bill.
Fraud | Rosenblatt’s Financial Crime Team
On 22 September 2021, UK Finance released its latest fraud report covering the first half of 2021. The report noted that £753.9 million was stolen through fraud, being a rise of 30% compared to the same period in 2020. The rise comes amidst an increase in the number of phishing attacks involving the fraudulent use of NHS branding. The Covid-19 vaccine rollout enabled criminals to target personal information by using various forms of social engineering methods. Criminals manipulated victims into sharing their personal details and passwords via scam phone calls, text messages and emails. This information was then used to target victims and convince them to authorise payments.
Banks are under increasing pressure to prevent their customers from becoming victims of fraud, though it is unlikely that banks will be able to solve the problem on their own. A voluntary code was set up to reimburse the victims of scams without blame. There are however concerns that banks are not following the code consistently and expect customers to hold a sophisticated knowledge of scams. Additionally, not all banks have signed up to the code.
UK Finance has called for action to ensure that the Online Safety Bill encompasses all economic crime. Which? Money editor, Jenny Ross, stated “The regulator must introduce mandatory and more robust reimbursement requirements for all payment providers, to ensure that customers are treated fairly and consistently when they fall victim to bank transfer scam”.
We have discussed the Online Safety Bill in an earlier article. The Financial Conduct Authority (FCA) argued that financial harm should be incorporated into the Bill to ensure tech firms are checking the authenticity of their advertising customers. The FCA noted that these social media platforms are being used by criminals to lure in suspecting investors particularly through adverts relating to crypto tokens.
UK Finance urges customers to follow the advice of the Take Five to Stop Fraud campaign. Customers should contact their bank and make a report to Action Fraud immediately if they think they have fallen victim to a scam.
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(Source: https://www.ukfinance.org.uk/press/press-releases/government-coordinated-action-needed-fraud-losses-rise-30-cent)
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