APP Fraud Rose By 22% In the UK Last Year; What is It and How to be Safe?

Authorised push payment or APP fraud has become extremely prevalent, especially in the UK where fast payments were implemented in 2008. Today this variant has robbed thousands in the UK, with the scam reportedly rising by 22% in 2022. So what is the APP fraud and what are the things to keep in mind to protect yourselves from such frauds?

What is authorised push payment or APP fraud?

Scams in which fraudsters manipulate their victims into parting with their money are commonly referred to as authorized push payment frauds. These include a host of fraudulent activities, extending from schemes on social media platforms to even dating websites, where fraudsters trick victims into transferring funds to them. 

Scammers try to coax people into making payments to them and in some cases even lure them into sharing their financial details so that they can directly take control of the victims' accounts. 

According to the Financial Times, scammers are using phone calls, email, and text messages to trick victims into simply giving them access to their emails and passwords. 

What Do The Experts Have To Say?

Besides harming your bank account these scammers are directly causing "psychological and emotional harm," as per Ben Donalson, managing director of economic crime at UK Finance.

"Criminals are increasingly using social media, online platforms, texts, phone calls, and emails to deceive victims into giving up their details and their money," he added. 

Most of these fraudsters have targeted their victims online. According to the reports, 77% of these cases tend to be low-value scams and are started online. Moreover, 17% of these cases are initiated through telecommunications networks and are higher-value scams which account for 45% of the losses incurred. 

Are we at Risk?

With small and large businesses adopting simpler ways to accept payments, using real-time methods to send money has become extremely recurrent in our lives. This is both a boon and a bane as we are getting into the habit of sending money as easily as sending a text message. Needless to say, the instantaneous transaction is good news for fraudsters, who can then quickly move the money to someplace safer which helps them launder the money and makes tracing very difficult. 

Identifying the Attacks

Fraudsters are always coming up with innovative ways to deceive and trick you into sending them money. Here are some ways a fraudster can try and deceive you. 

A Familiar Invoice: Something that looks familiar, like from your service provider but then turns out to be from a con artist instead. 

Payment requests from people pretending to know you: Say you get a payment request from a carpenter or a builder who claims to know you. 

"Hey, Mum" Scams: Scams that pretend to be your loved ones asking for immediate financial help. 

Property Transaction Interception: Say you are in the process of buying a new house and you are regularly having telephonic meetings with your seller, or real estate agent. Fraudsters are reportedly intercepting such calls and asking for payments. 

Retail Giant Amazon Joins Hands With UK Banks to Tackle APP Fraud

Experts like Kathryn Westmore, senior research fellow for financial crime at the Royal United Services Institute, told FT that APP fraudsters are "displaying innovation" and are also "reinventing their modus operandi and reacting to geopolitical events." 

The publication also reported that almost 98% of the victims received refunds and now financial institutions and retail giant Amazon have joined hands with Stop Scams UK, which is the cross-industry body of banks, technology, and other groups, to understand more about the situation and help tackle the problems.