The number of recorded crime series incorporates fraud offences collated by the National Fraud Intelligence Bureau (NFIB) from three reporting bodies: Action Fraud (the public-facing national fraud and cybercrime reporting centre) and two industry bodies, Cifas and UK Finance (who report instances of fraud where their member organisations have been a victim) show an Increase in the volume of fraud offences in the last year.
Findings for the year ending December 2018 estimated that the number of fraud incidents (3.6 million) increased by 12% from the previous survey year.
The increase was driven by a 27% rise in “consumer and retail fraud” (to 1 million offences) and a 118% increase in “other fraud” (to 135,000 offences). The increase in “other fraud” is partly driven by a change to the coding of this category. This change, however, does not account for any of the increase in overall fraud, as it only affects the classification of offences within the fraud category rather than the volume of fraud offences. There was no significant change in “bank and credit account fraud” and “advance fee fraud.”
Crime Survey for England and Wales fraud – number of incidents for year ending December 2017 and year ending December 2018 with percentage change
|England and Wales||Adults aged 16 and over|
|Offence group||Jan ’17 to Dec ’17||Jan ’18 to Dec ’18||Percentage change and significance4|
|Number of incidents (thousands)|
|Bank and credit account fraud||2,327||2,433||5|
|Consumer and retail fraud||813||1,031||27||*|
|Advance fee fraud||61||50||-19|
|Unweighted base – number of adults||20,974||34,073|
|Source: Office for National Statistics – Crime Survey for England and Wales|
Commenting on the latest Office for National Statistics (ONS) crime in England and Wales statistical bulletin, Josh Gunnell, Head of fraud & ID pre-sales at TransUnion said “The latest ONS crime figures reflect the evolving challenges of combatting financial fraud today, revealing a 12% increase in overall fraud in 2018 compared with the previous year, based on the Crime Survey for England and Wales (CSEW). This is driven in the main by consumer and retail fraud offences which increased significantly by 27% year-on-year.
“Consumers are spending more time and money shopping online, therefore, unsurprisingly, we’re seeing a related acceleration in cybercriminals targeting retail and consumer accounts. With over half the fraud incidents in 2018 thought to be cyber-related, it’s clear that many businesses still do not have adequate defences in place to mitigate the risks.”
“Regulatory change is coming which could help address some of the current fraud challenges in the market, with the rollout of PSD2 due later this year, but the trends confirm a clear message – that fraudsters are evolving their tactics over time and will continue to exploit institutions that have the weakest links.”
“2018 saw a huge rise in authorised push payment (APP) fraud, which has nearly doubled, up 93% over a 12-month period resulting in total losses of £354.3m, as reported by UK Finance. In these cases, the account holder has authorised the transaction themselves after being tricked by a fraudster, and as such they have no legal protection to recover the loss.”
“This rise, I suspect, has in part been observed because of the heightened awareness of this type of scam, and therefore an increased likelihood of reporting it compared to the previous year, when it was little known and some consumers were perhaps embarrassed to admit they’d been duped.”
“In addition to the financial losses, APP fraud presents a reputational challenge within the industry. We’ve seen banks and financial service providers that we work with implement a variety of changes in payment screens to help customers avoid scams, as well as conducting social media and marketing campaigns to ensure their customers rightly question suspicious activity and don’t fall prey to the kind of spoofing that is becoming commonplace. That said, despite greater consumer awareness of methods employed by criminals, there should continue to be more education provided to prevent customers from falling prey to ever-more sophisticated attacks.”
“The key message from this bulletin is that fraud is not going away. Businesses need to be continually enhancing their security with additional checks to complement their existing processes. Some institutions have already implemented more rigorous transaction processes to help reduce risk, and this is something that needs to be adopted more widely, alongside ongoing due diligence checks, to help ensure customers can make online payments as safely as possible.”