As the Financial Times reported Sunday (July 9) — citing unnamed sources — the group has written to Jeremy Hunt, the British chancellor, saying that its data has found that 61% of all reported authorized push payment (APP) fraud by volume is connected to Meta’s social media platforms Facebook, Instagram and WhatsApp.
PYMNTS has reached out to both UK Finance and Meta for comment but has not yet received a reply.
APP fraud is a type of scam in which criminals dupe consumers into transferring funds from their bank accounts.
Earlier this year, UK Finance released a report that showed that 78% of APP fraud begins online, with another 18% starting via telecommunications.
“Our data also makes clear just how much fraud emanates from online platforms and through telecommunications,” said David Postings, chief executive at UK Finance.
“The government’s new fraud strategy rightly says we need to focus on stopping it at source and that these other sectors need to do far more to tackle the problem they are facilitating.”
The group’s report found that APP fraud was driven by abuse of online platforms, which included things like investment scams advertised on search engines and social media, and scams against customers of dating platforms.
“Criminals used scam phone calls, text messages and emails, as well as fake websites and social media posts, to trick people into handing over personal details and passwords,” the report said. “They subsequently used this information to convince people into authorizing a payment.”
As PYMNTS has reported, the U.K. has been plagued by a payments fraud epidemic in recent years, leading regulators to now require banks to reimburse victims of APP fraud.
“But while refunding victims could be seen as a step in the right direction, experts have flagged a moral hazard risk as the rules could make individuals less inclined to take the necessary precautions when making payments,” that report said.
PYMNTS also spoke earlier this year to UK Finance’s Katy Worobec, managing director, economic crime, about the potential limitations of artificial intelligence in combating fraudulent activities in the banking and financial services sector.
No matter how advanced the technologies being used, Worobec said that as long as fraudsters can convince victims to let them access their personal information, it’s back to square one.
“You can have as many locks on the door as you like but if someone gives you the keys, or even opens the door for you, all bets are off,” Worobec said, adding that “while new technologies are helpful, customers still need to be vigilant and protect themselves against fraud.”