Header Ads

How the Finance Industry Got Saved From Attempted Fraud

You have heard about scams all around the world but did you ever hear about a country being saved from an attempted fraud?

Quite rare isn’t it?

Well, recently, one of the prominent countries of the world got saved from disaster in a major financial fraud. Banks and companies jointly prevented an illegal financial fraud of approximately £1,458.6 million in the previous year.

In the year 2017, fraud losses on payment cards depreciated by 8%, while on the other hand, card spending raised by 7%. The overall proportion equates to 7.0p for every £100 spent which is the lowest ever since 2012.  On the contrary, in 2016 this figure aroused to 8.3p

The report of 2017 depicts the following facts:

o   As mentioned above fall in unlawful transactions by 8%.
o   Combined loss declined by 5% to £ 731.8 million.
o   28% deviation in cheque fraud loss which is equivalent to £9.8 million
o   3% increase in number of illegal financial fraud cases and 1,910,490 cases were reported.

Mentioned below are details of new authorised push payment scams data which are gathered for the first time in the year 2017:

Approximately, 48,875 cases were reported for authorised push payment scams with net worth of £ 236.0 million. When the real figures came into light, 88% of them accounted to be retail consumers losing out £ 2,784 on an average.  Plus, rest of the businesses lost on an average £ 24,355 per case.

Fortunately or unfortunately, financial providers were capable of returning only £ 60.8 million i.e. 26% of the total authorised APP (authorised push payment) scam loss in 2017.

If you look at a bigger picture, fraud can be considered a termite that affects the entire society. Almost everyone should come together to get rid of this termite and eliminate it from the financial system.

Although, the financial industry has taken an initiative of installing security systems in order to safe guard customers, setting new standards on how banks should revert to scam victims and disrupt criminals. They put in efforts to trace back stolen funds.

If you are a keen observer of financial activities you might have noticed the financial industry adopting the following measures against varied scams:

o   They have introduced awareness campaigns which help people to not being duped by fraudsters and how to be safe.
o   The industry has begun working in accordance with government and law enforcement with the sole motto of eliminating criminals and also to acquire back the stolen funds.  While working with new powers it is essential to share information and allow banks to do the same in order to avoid financial crime.
o   Implement new standards for individuals who have already being prey to fraudsters and offer them much needed help. For instance, there are several companies which work in association with FCA and help victims to apply for PPI reclaim so that they recover their lost sum.
o   The industry is working with government to implement legislative changes right from account opening process so that the industry can act proactively work on suspicion of fraud and restrict fraudsters from getting into the financial system.
o   The Banking Protocol- A quick and clear response scheme that gives liberty to branch staff to alert police about suspected fraudster or any police force across the country. It has been witnessed that this Protocol prevented a fraud of £ 13.3 million which eventually resulted in 129 arrests.
o   Offering a particular police unit to dedicated car and payment crime unit helps to tackle tough fraudsters and eliminate scams. This has resulted into better savings and depreciated criminal activities accounting to £ 30 million in the year 2017.
o   Plus, the industry is in constant search of new ways to trace back stolen funds running amongst multiple bank accounts.

Difference between unauthorised and authorised funds

Often, people are confused amongst two types of funds namely-authorised and unauthorised. It is important to have a clear understanding of the two if you are dealing with finances.

A vague understanding of them can land you in trouble, it is thus, essential to ask for personal and professional financial details to the concerned institute or person.

Authorised Funds-

As the name suggests it is an authorised push payment commonly referred as APP.  The account holder gives the authority of the payment to be made in another account. According to current law, if a customer authorises the payment themselves then they do not have any legal protection to bear their loss.

Usually, banks make an attempt to help recover lost money of their customers but it’s a bit late. Because, customers inform about the scam after the transaction has been completed.

In this duration, the fraudster has already withdrawn the amount and the money is gone.

Unauthorised fraud-

In this case, the account holder does not actually provide any consent for the transaction but it is carried out by the third party.

The industry is taking all crucial measures from its end to improve security and assistance for financial transactions. Hopefully, customers may recover their lost sums of money if the industry is successful in acquiring back all the stolen funds.
Powered by Blogger.