Online Scams Take £630 Million From Victims

Authorised Push Payment Fraud, or APP fraud, happens when someone is persuaded to authorise a payment, believing they are paying for a product, service, or financial investment, over the phone or via online banking. It can take many forms, including romance, impersonation, and cryptocurrency scams.

Victims of APP fraud are deceived into sending money. Because they initiate the money transfers, banks have historically been unwilling to take responsibility for preventing APP fraud. However, the introduction of the new reimbursement rules in October 2024 has put greater emphasis on protecting customers from financial crime.

Whether posing as a product or service, fake websites are designed to gather victims’ personal details, such as their name, address, and banking information. This is a process known as ‘phishing’. The fraudsters then use these details to take money without providing the advertised product or service.

As online scams become more prevalent, it’s essential to know some of the warning signs that a website may not be legitimate:

• Items or services are at a lower price than usual
• Odd payment methods, such as gift cards and Bitcoin
• An error message that asks you to click a link

If you think you have fallen victim to a fake ‘phishing’ website as part of any kind of APP fraud, you must act quickly. You should first inform your bank, which will investigate the matter and decide whether it can reimburse you. If your case is straightforward, their decision should be reached within five working days.

You should also urgently report what has happened to the police and Report Fraud (formerly Action Fraud), the UK’s national fraud and cybercrime reporting centre. This may help stop scammers from doing the same to others.

If you have an unresolved dispute with your bank regarding reimbursement, you can try:

• Escalating your complaint to the Financial Ombudsman Service (FOS), the independent government-backed body responsible for settling disputes between regulated financial institutions and their customers.
• Exploring private prosecution. This route may be appropriate when there is a criminal case to answer, and the evidence meets the required standard, but the police or the Crown Prosecution Service are unable to pursue it.

Sarah Spruce, Legal Director at TLW Solicitors, commented:

“It may surprise a lot of people to read that so many young people are falling victim to online financial crime, but the truth is that these scams can happen to anyone. Advancing technology and the increasing use of convincing AI amongst scammers are making it increasingly difficult to spot real from fake.

We are continuing to see significant numbers of people affected by APP fraud, including those targeted online through phishing scams such as fake websites and social media accounts. Advancing technology, coupled with social engineering, make scams very convincing.

Although banks can offer reimbursement in simple cases, this doesn’t apply to all victims. That’s why those affected by scams need to get the right legal advice to improve their chances of recovering lost funds, whether through civil claims or private prosecution.

If you or a loved one has been impacted by APP fraud, get in touch with our specialist financial crime team for a confidential and no obligation discussion to explore your options.”