- Consumers filed 8,734 fraud and scam complaints between April and June 2024
Fraud and scam complaints hit their highest ever level for a three month period, new data from the Financial Ombudsman Service shows.
Between 1 April and 30 June this year, consumers lodged 8,734 complaints about fraud and scams.
Over half these cases related to customer approved online bank transfers, also known as authorised push payment (APP) scams.
By comparison over the same period in 2023/24 there were 6,094 fraud and scam complaints – representing a 43 per cent jump in cases.
Scam alert: Official data from the Financial Ombudsman Service (FOS) shows complaints about fraud and scams have hit an all-time-high
The rise in cases is due to higher numbers of multi-stage frauds, where customers put in multiple claims due to the number of firms involved.
More people inadvertently using their credit or debit cards to pay fraudsters is also behind the rise in cases as well as more online fraud cases being brought by professional representatives.
Many banks have now signed up to the voluntary Contingent Reimbursement Model (CRM) code which provides additional protection for consumers, and means they are reimbursed unless there are exceptional circumstances.
If a bank has not signed up to the CRM code, customers could be less likely to be reimbursed if they have fallen victim to a scam and lost money.
Of 4,752 APP scam cases received by the Ombudsman in the first three months of this financial year, 2,734 were not covered by the code – with 49 per cent of cases that fall under the code upheld, compared to 36 per cent that do not fall under the code.
New fraud reimbursement rules which come in to force on 7 October 2024 should see the time it takes for scam victims to be reimbursed reduce.
Under the new rules, being brought in by the Payment Systems Regulator (PSR), firms will have to reimburse customers who are victims of scams unless the customer has been grossly negligent.
But, the new reimbursement rules were set to cover APP scams up to £415,000 with some exceptions – such as the payment being made abroad.
However, it’s believed the payments regulator could water this down and cap it at £85,000.
APP fraud losses came to £459.7million in 2023 the most recent annual fraud report from UK Finance show.
There was a significant rise in complaints where people came across investment opportunities on social media and then inadvertently paid fraudsters using their debit or credit cards, FOS data shows.
There were 1,500 complaints from people who used their cards to pay for investments which turned out to be scams, compared to around 1,100 complaints in the first three months of the last financial year.
Card payments, unlike bank transfers, are not covered by the CRM code or the new PSR rules so customers could have less protection in the event this happens.
Abby Thomas, chief executive and chief Ombudsman of the Financial Ombudsman Service, said: ‘Being a victim of a fraud and scam is a horrendous experience – not just financially, but emotionally too. That’s why it’s disappointing to see complaint levels rising to even higher levels.
‘In recent years, we have investigated thousands of cases, returning more than £150million to those who have fallen victim to these crimes.’
Pat Hurley, Ombudsman director for banking, said: ‘Fraudsters’ methods are always evolving, and we continue to see that reflected in the complaints brought to our service.
‘We are currently receiving – and resolving – around 500 fraud and scam complaints a week. In all the cases we receive, we’ll look at the individual circumstances and investigate whether a business did everything it was required to do.
‘When we do uphold complaints, we expect firms to learn from our findings and apply them to any future interactions with their customers.’
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