The UK saw a slight dip in financial fraud losses in 2022, with losses falling to £1.2 billion, a decrease of eight percent from the previous year, according to UK Finance figures. This reduction was driven by a 17 percent fall in authorised push payment (APP) losses, which fell from £583.2 million in 2021 to £485.2 million in 2022. Within this, 57% of all reported cases related to purchase fraud, with case volumes breaking 100,000 for the first time.

Despite the decrease in APP fraud, investment fraud remained one of the largest proportion of APP losses, accounting for 24 percent of losses. However, there was a 34 percent reduction in investment fraud compared to the previous year. Overall, the amount of APP fraud losses reimbursed increased by five percent in 2022 compared to the previous year.

UK Finance has conducted analysis on over 59,000 APP fraud cases to show the sources. More than three-quarters of cases originated online, with social media platforms accounting for the greatest number of online fraud cases. Telecommunications accounted for 18 percent of fraud cases and tended to be higher value cases, such as impersonation fraud, accounting for 44 percent of losses.

The financial services sector has long complained that social media and telecommunications firms have escaped responsibility for compensating the victims of financial fraud. Business banking platform Tide has called on the government to introduce a tax on social media and telecommunications companies to fund and train more police officers to tackle what it calls Britain’s “fraud epidemic.”

David Postings, Chief Executive of UK Finance, said that the banking and finance sector spends billions on detection and prevention and also refunds people who have fallen victim, even if the fraud originated outside the banking system. He also highlighted the significant amount of fraud that emanates from online platforms and through telecommunications, stating that these other sectors need to do far more to tackle the problem they are facilitating. The UK government’s new fraud strategy rightly focuses on stopping fraud at its source, but it remains to be seen whether social media and telecommunications companies will be held accountable for their role in facilitating fraud.