Do you work in Financial Services? Are you struggling to implement successful anti-fraud initiatives? Apparently half of UK companies were victim to fraud or economic crime between 2016-20181. Check out these eye-opening statistics below so your business can fully gauge the reality of fraud, and take the necessary measures in order to mitigate the risk.
1. Criminals stole £1.2 billion through fraud and scams in 20182
The report by UK Finance highlights that although the advanced security systems and innovations implemented by the financial industry stopped more than £1.6 billion worth of fraud, it still wasn’t enough to prevent it entirely. Therefore, in order to reduce the risk of fraud you should analyse what measures you currently have in place and assess the introduction of new ones. For example, organisations who use proactive data monitoring detect scams in half the amount of time3 in comparison to those who don’t.
2. Over 12,000 financial fraud complaints have been lodged in 20194
Banking fraud complaints have hit an ‘all-time high’ according to the UK’s Financial Ombudsman Service. This was a 40% increase from the previous year and more than double the volume of complaints received three years previously. In addition to being affected by fraudulent activity, the other issue that businesses need to be aware of is customer retention. It is equally important that you safeguard your customers from fraud as well as the company.
3. Over 50% of businesses recover less than a quarter of fraud losses5
61% of respondents to KPMG’s Global Banking Survey also said the volume of external fraud has increased, with a further 59% claiming the value has increased too. If this continues to happen then financial services organisations will subsequently end up operating at significant losses, causing a multitude of problems. Further to this, the findings highlight that although fraud detection is becoming more sophisticated, some elements are still slipping through the gaps. This means that new fraud prevention methods are always necessary.
4. Mortgage fraud has risen by 5%6
Mortgage fraud has increased in a relatively short period of time, with the above figure being measured in the first six months of 2019 in comparison to the latter half of 2018. Fraud by production of a false document increased by 14%, and between 2017-2018 £4.1 billion was stolen as a result of credit card fraud7. This just goes to show that verifying identities is a must.
How can Hopewiser help?
Multiple Residence from the Royal Mail Postcode Address File (PAF), supplied by Hopewiser, unleashes over 800,000 additional address data records which were previously unobtainable. Many premises are sub-divided, sharing a common letterbox, and access to these properties is restricted to a single shared delivery point. If you are unable to verify the individual’s address, this presents numerous issues when it comes to fraud risk.
Multiple Residence provides access to self-contained flats, sub-divided houses, apartments blocks, halls of residence, and nursing homes. Accurate data can help financial services reduce the risk of fraud, and this dataset will help you verify whether an address exists, thus ironing out fraudulent addresses and mitigating credit card, loan, and mortgage fraud. To find out more about PAF and Multiple Residence data, contact us today.
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Sources
1 Half of UK companies have been victims of fraud or economic crime in last two years (Independent 21st February 2018)
2 Fraud the Facts 2019 – The definitive overview of payment industry fraud (UK Finance 21st March 2019)
3 Using data analytics to help prevent and detect fraud (Meaden & Moore 18th April 2019)
4 Banking fraud complaints hit ‘all-time high’ (Financial Times 15th May 2019)
5 Global Banking Fraud Survey (KPMG May 2019)
6 Mortgage fraud rises 5% (Financial Times Advisor 25th September 2019)
7 £4.1 billion stolen as a result of credit card fraud in the UK in past year (22nd November 2018)
, updated 19th April 2022.
