Fraud increased by more than a third during the Pandemic

The ONS has released crime figures with reported crimes to the National Fraud Intelligence Bureau from Action Fraud, Cifas and UK Finance that showed there were 5.1 million fraud offences in the year to September 2021, up 36% from two years earlier with 26% of victims lost money that was never paid back.

The statistics of fraud reported to Action Fraud saw 413,417 offences – up 27% in a year,  referrals from Cifas were up 5% to 319,512 and those from UK Finance were up 49% to 155,757.

The Action Fraud figures showed a 42% rise in investment fraud to 22,372 offences. They also showed an 18% rise in advance fee payments, to 51,407 offences. This included delivery scams where people were persuaded to pay fees for non-existent postal deliveries.

Whilst UK Finance reported a 53% increase in remote banking fraud (to 94,757 incidents).

Cifas CEO, Mike Haley, said “The latest crime statistics shine a harsh light on the gap between the vast scale of fraud and the tiny proportion of police funding dedicated to fraud. It is scandalous that fraud accounts for almost half of all crime, and continues to grow, but just 2% of all police funding is allocated to tackling it.”

“Too often other crime types are used as an excuse for not better resourcing the fight against fraud, when in fact fraud both funds and enables other serious and organised crime types, from people trafficking and human slavery, to terrorism. Indeed, little organised criminality could be carried out without identity fraud to provide access to fraudulent funds, accounts and documentation.”

“Fraud causes grave harm, represents a national security risk and must be prioritised accordingly by government and policing. These statistics are a timely reminder, at a time of focus on COVID-19 scheme losses, that we can ill afford to simply write-off fraud.”

“Government needs to urgently bring forward the Economic Crime Reform Bill, increase investment in policing fraud, and develop a dedicated national strategy to tackle fraud.”

Josh Gunnell, Head of Fraud & ID pre-sales at TransUnion in the UK, said “The latest quarterly fraud figures from the Office for National Statistics highlight the extent of the impact of the pandemic, with fraud up 36% for the year to September 2021, compared with the year ending September 2019, at 5.1 million fraud offences. Much of this was driven by financial and retail fraud, which is unsurprising, given the behavioural changes and increased digitisation we’ve seen as a result of Covid-19.”

“Particularly concerning is the rise in digital fraud within financial services, with UK Finance reporting an increase of 53% in remote banking fraud for the year to September 2021 and financial investment fraud rising 42% for the same period, according to Action Fraud.”

“More widely, advanced fee fraud, including the common delivery service scams where victims transferred funds to fraudsters, saw a sizable increase of 18% – from 43,555 to 51,407 offences – in the last year.”

“Going into another year where consumers will face a barrage of threats online, it’s more important than ever for businesses to take a rigorous approach to fraud prevention and identify verification. By implementing proactive and predictive solutions that make data-led decisions on potentially fraudulent activity, businesses can help deliver safe experiences, without compromising on the customer journey.”

“It’s positive to hear that the UK government is currently drafting its landmark Online Safety Bill. With pressure from lobbyists, it seems a real possibility that new anti-fraud legislation will help tackle the scourge of push payment scams that are served to consumers via paid-for advertising. This could be a major step towards breaking the trend of increased fraudulent activity online alongside progress being made on the UK’s digital identities trust framework.”

Sarah Coles, Senior Personal Finance Analyst at Hargreaves Lansdown said “The pandemic has been boom time for fraudsters. In the two years to September, scams increased by more than a third, as it became easier to target people spending more time online and at home, and many of them had more to lose.”

“Trends during the pandemic have made us more vulnerable. More of us are spending longer at home, including those who are limiting social contact and people who are working from home. It means that if scammers call or email us at home, they’re more likely to reach us.”

“At the same time, more of us are shopping and banking online. This boomed particularly during lockdowns, but new habits have stuck even now that the high street has reopened. This means more of us are being exposed to shopping scams and online banking fraud. The pandemic has also seen more people take an interest in investment, and when they search for information online, it can expose them to potential scams.”

“Some people have more to lose at this stage, as their spending fell during lockdowns and they were able to build up lockdown savings. This has persuaded fraudsters to redouble their efforts. On the flip side, some have lost income during the pandemic and have been searching for opportunities to make money. Scammers are always keen to cash in on this and attack people at their most vulnerable.”

Rocio Concha, Which? Director of Policy and Advocacy, said “These new figures throw into sharp relief the epidemic of fraud which is gripping our society. Fraud is by far the most common type of crime faced by people and has risen even further as fraudsters take advantage of the growth in people shifting their activities online due to coronavirus.”

“The government needs to take an important step in cracking down on this problem by ensuring that it includes paid-for advertising in the Online Safety Bill. This would make online platforms use their highly sophisticated technology to prevent harmful content from appearing on their sites.”