Welcome to Britain, the bank scam capital of the world

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  • Fraudsters stole a billion dollars in just six months – industry data
  • Tech giants on target of miscreants taking advantage of social media
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LONDON, Oct 14 (Businesshala) – It was an email offering a discount on an electric toothbrush that started the sequence of events that ruined Anna’s life.

Within minutes of entering his card details, he got a call from his bank that he was being dealt with fraudulently. The next day Robert Clayton from Britain’s Financial Conduct Authority said they were pursuing criminals, but that their savings were at risk.

There was no toothbrush though. No fraud department, no Robert Clayton. They were all part of a scam to gradually take away Anna’s life savings, and within a few weeks the plot of about £200,000 ($270,000) was successful.

“I am still in shock, guilt and shame impossible to express,” said the 78-year-old widower from central England, who did not want her full name to be used in the story.

He is one of thousands who have seen savings from an unprecedented wave of online bank fraud in the UK this year, where you are more likely to be a victim of online fraud than any other crime.

The country is the global epicenter for such attacks, according to five of the biggest British banks and more than a dozen security experts, who said scammers are using batches of consumers’ personal details to target record numbers of purchases and banking on the dark net. were buying. since the pandemic.

Banks and experts said the country’s super-fast payments infrastructure, relatively mild policing of fraud-related crime, as well as the use of English, the world’s most widely used language, made it an ideal global test bed for scams. has made it.

According to data from banking industry body UK Finance, a record 754 million pounds ($1 billion) were stolen in the first six months of this year, up 30% from the same period in 2020, and more than 60% from 2017. . , when it started collecting data.

This represents the per capita fraud rate, according to Businesshala calculations from UK Finance and the latest available Federal Trade Commission data, similar to that seen in the United States in 2020.

“The most sophisticated fraud starts in the UK, and then two years later moves to the US and then around the world,” said Aylette Bigger-Levin, vice president of product strategy at US-based cybersecurity firm BioCache. Fraud techniques to banks.

“In the last 12 months we’ve seen more fraud attacks than any other year in history. Data breaches have also accelerated, so there’s a lot of personal information that criminals can take advantage of.”

‘Money would have supported us’

Unlike the simple email-based scams of the past that sought your help from princes or oil businessmen to move their millions, the modern bank scam can be sophisticated, multi-stage and extremely convincing.

Brian Dilly, director of Britain’s largest economic crime prevention group, said: “We’ve seen some cases where fraudsters have been talking to someone for three or four years before they actually duped them of big money. ” Bank Lloyds.

Another scam victim, Dina Karia, told Businesshala that she lost £10,000 in early February after buying a secured bond allegedly issued by Credit Suisse and apparently listed on the price-comparison site MoneySupermarket. .

After filling out a form on the website and receiving a call from a staff member there, he called them back to the number listed on the website to check that the phone number was valid, did further investigation about the bond and went on to invest .

Outer London-based Caria still doesn’t know exactly how her money was stolen, but she believes scammers may have created a fake website imitating MoneySupermarket.

The real MoneySuperMarket had on February 15 warned of its website being fake and impersonating its employees. A spokesperson for the company said it is working with the FCA to remove such fake websites and phone numbers, uncover cloned websites and report issues to the police.

“I lost my father a long time ago, I am taking care of my mother and that money would have supported us for years,” Kariya said.

Barclays, her bank, has returned only half the money, saying she could have done more to protect herself.

“We sympathize with Miss Karia, who was the victim of an investment scam, and as the matter is currently being investigated by the Financial Ombudsman Service, we await the conclusion of her review,” Barclays said.

Faster payment, faster fraud?

The government’s National Center for Economic Offenses (NECC) agrees with the banking sector’s assessment that fraud is a threat to British security.

“It’s already ramping up,” said Chris Reid, head of fraud threats at NECC, who he said works at least every month for bank owners, technology executives and telecommunications companies to assess and respond to threats. meeting with.”

Britain’s fast payments network, which allows transfers between bank accounts to be settled instantly rather than in hours or days like in the United States and other developed banking markets, means criminals can withdraw funds faster.

“The faster payment system has facilitated faster fraud,” said Richard Emery, a fraud expert who has been advising Anna and 63 other scam victims, who have an average loss of £102,000.

Pay.UK, which runs the network, said the system supports the British economy, consumers and businesses. It said criminals are getting better at taking advantage of digitization and it is working with industry and regulators to fight fraud.

While security experts and senior bankers said many fraudulent attacks could be traced abroad – including in India and West Africa – the UK is also increasingly exporting the attacks.

Crimes such as Authorized Push Payments (APPs) – where people are tricked into authorizing payments by a criminal posing as their bank or other trusted company – began as a large-scale UK phenomenon globally. are spreading on.

The country ranks second in the world after the United States as the source of automated bot attacks, the fastest growing fraud attack in the world, according to data from financial crime analysis firm, LexisNexis Risk Solutions.

Bot attacks see criminals use large amounts of stolen identity credentials to destroy a website, allowing them to set up new accounts or access existing ones.

“It’s popular to say that the threat of fraud is imported into the UK, and I don’t think that analyses,” said NECC’s Reid. “There is a significant UK nexus to a lot of fraud, our operational experience is showing this.”

HSBC: Britain is a victim of fraud

UK banks – which often raise compensation bills when people are duped – are trying to respond.

HSBC, which has operations in the US and Asia, has hired more than 300 employees a year to support anti-fraud operations in its domestic market and annual expenses to deal with the “exponential” number of affected customers. has increased by 40%. The bank told Businesshala.

“The UK is a hotbed of activity for fraudsters. The UK currently accounts for about 80% of our global personal fraud losses,” it said.

Lloyds said it has invested £100 million in its defense over the past two years, while rival NatWest has 10% of its workforce – amounting to 6,000 people – dedicated to combating financial crime. TSB hired an additional 100 employees over the past year to support fraud victims.

But lenders are also pressuring the government to create social media platforms, where they say some attack, sharing the burden. British lawmakers told the owners of Facebook, Google, Amazon and eBay last month that they needed to do more fraud.

NECC’s Reid said another problem was that only 1% of police resources were devoted to fighting fraud, despite it accounting for more than a third of crimes in England and Wales.

“I will not hide from the fact that the resource of the response is completely out of line with the scale and severity of the threat. We have a mountain to climb.”

This means that criminals are encouraged to target people like Anna, who have little hope of recovering their savings.

The fraudsters told him to transfer the cash “at risk” to an account on a cryptocurrency platform that they emptied – while emphasizing confidentiality and training him on how to respond to skeptical bank executives. separated from the family.

“They knew my financial advisor’s name, they were absolutely as confident as the FCA staff,” she said. “And they told me I couldn’t tell anyone about the investigation because it would hurt their efforts to catch the crooks.”

($1 = 0.7327 pounds)

Reporting by Lawrence White and Ian Withers; Editing by Rachel Armstrong and Praveen Charu

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