The half-year Fraud report, sponsored by LexisNexis® Risk Solutions, highlights that over £600 million was stolen through fraud and scams in the first half of this year. Here’s a quick summary of what these latest figures are telling us about the fight against the fraudsters.

• It is a good news story overall for UK financial services: With an overall decline of 13 per cent in fraud compared to 2021, the indications are that increasing adoption of fraud prevention technology is having a net positive impact on the front-line defence against fraud and scams.
   
• However, criminals continue to pivot and adapt: While the end of the pandemic has seen falls in some types of fraud, others have increased. Social engineering continues to drive both unauthorised and authorised fraud losses, fuelled by calls, texts, emails and fake websites designed to trick people into handing over personal details and passwords.
   
• Some fraudsters are turning back to lo-tech methods: This year's report highlights that as fraudsters come up against sophisticated anti-fraud measures, they are falling back on tried and tested low-tech fraud methods, like distraction, ‘shoulder surfing’ and cameras on ATMs. Lost or stolen card detail cases grew by 35 per cent, debit and credit card interceptions increased by almost a quarter (23 per cent), and card theft is up by 101 per cent.
   
• Fraud losses overall remain significant but are falling: Losses due to unauthorised fraud decreased by nine per cent to £360 million, while losses due to authorised fraud, such as push payment scams fell 17 per cent to just shy of £250 million compared to the previous year. Despite these eyewatering figures the direction of travel is positive.
   
• Overall fraud prevention figures down: The banking and finance industry prevented almost £584 million of unauthorised fraudulent transactions in the first half of this year – a huge figure, but down 20 per cent on a year ago. It is not clear whether prevention efforts have yielded less success, or there was simply less fraud about to prevent – or a combination of both.
   
• Investment scam victims suffer worst individual losses: UK adults lost over £61 million to investment scams this year, as fraudsters dupe victims into placing large sums into fake gold, property, carbon credits and cryptocurrencies investments among others. Although losses were down six per cent this year, they are still double those of purchase scams (at £31 million) and four times those of romance scams (at £16 million) or advanced fee scams (£14 million).
   
• …but impersonation scams generate highest overall losses: A dizzying £90.5 million was lost overall to these highly complex and difficult to detect scams in the first half of this year. In three quarters of cases, fraudsters pose as a bank official or police officer and so convince the victim of their authenticity that they ignore warnings from their bank.
   
• Higher contactless limits create fraud opportunities: Losses on both contactless cards and mobile devices more than doubled in the first six months of 2022, totalling £15.4 million. However, spending on contactless also increased by 76 per cent to £117 billion during the same period, as people took advantage of the higher purchase limits. Contactless fraud remains low compared to other types of fraud, equivalent to 1.5p in every £100 spent.
   
• More fraud victims are getting their money back: While it’s the norm for unauthorised fraud victims to see their money again (around 98 per cent in the latest count), increasingly, authorised fraud victims are also getting refunds. These have nearly doubled from £75 million in 2020 to £140 million this year, although presently only around half of APP scam victims are reimbursed.
   
• The fight against fraud must become a cross-industry effort: The report concludes by highlighting that fraud losses are driven by the theft of customers’ personal and financial data, which often occurs because of data breaches in third parties and industries outside the financial sector. Therefore, only a united cross-industry effort will stem the flow of stolen information that fuels this pernicious crime.