Research conducted by UK Finance has revealed nearly 7,000 authorised push payment (APP) scam cases, indicating that 70% of scams originated on an online platform — highlighting the internet’s significant role in enabling fraud.
The new analysis comes as the government published the draft proposal of its Online Harms Bill this week, to include user-generated content on social media platforms as a care of duty requirement by digital platforms.
The financial services trade body detailed that fraudsters are adapting their tactics to exploit societal changes, with the COVID-19 pandemic accelerating consumers’ shift towards online verticals.
The findings from the new UK Finance dip sample shows that most investment (96%), romance (96 %) and nearly all purchase (98%) scams originated online.
As it stands, the draft Online Harms Bill will tackle fraudulent investment schemes posted by users on social media – but will not tackle the same scam when digitally advertised or set up through a cloned website.
David Postings, Chief Executive at UK Finance, said: “As more of us have shifted online because of the pandemic, we’ve seen a spike in money mule activity and investment and purchase scams because criminals can target people directly in their homes across online platforms. The banking and finance industry is continuing to tackle fraud on all fronts, but there is a limit to what we can do alone.
“We were pleased to hear that the upcoming Online Safety Bill will tackle some aspects of fraud, but it won’t protect people from fraudsters’ online adverts and cloned websites. We encourage government to include all economic crime within the Bill when it is formally introduced. Not doing so leaves a large proportion of the public at high risk of being scammed online, because criminals are experts in adapting their tactics to exploit any loopholes.
“I welcome the recent steps taken by some online platforms to work with us on tackling this issue. This shows commitment and is evidence of the emergence of greater cross-sectoral collaboration to tackle the root causes of economic crime.”