YOUR PACKAGE has a £2.99 ($4) shipping fee. Suspicious activity has been detected on your account; please press 1. We are pleased to inform you that you are eligible to receive a tax refund. You have started an Amazon Music subscription charged at £28.99 a month; click here to cancel it. Scams invariably sound ridiculous until you fall for one.
A growing number of people do. According to the Crime Survey of England and Wales, the year to June saw 6.8m incidents of fraud and computer misuse (meaning mostly hacking). That is 43% more than two years earlier and 40% more than every other crime. The police have long put common, unsophisticated offences such as burglary, muggings and assaults into a category they call “volume crime”. Fraud is more voluminous than all of it.
“We don’t have much stuff in our homes that can be stolen and fenced down the pub,” says Mike Haley, the boss of Cifas, Britain’s fraud-prevention agency. But Britons do have bank accounts which can be drained, and equity in their homes that can be stolen during conveyancing. They were keen on digital commerce and banking even before covid-19, making them vulnerable to online fraud. Early last year the European Commission found that 67% of Britons had experienced a fraud or scam. Only two EU countries had higher rates.
The nature of fraud has changed, particularly in the past year (see chart). Payment-card fraud has declined, in part because banks have become better at spotting suspicious transactions and in part because the pandemic kept people in their homes, reducing opportunities for stealing cards. Mobile and internet banking fraud has grown—but then, so have mobile and internet banking.
The biggest growth area is authorised fraud, in which ordinary people are duped into transferring money to criminals. “It’s much easier to con somebody than it is to defeat security measures,” says Ben Poxon of UK Finance, a trade group. In the past year criminals have exploited people’s desire for love (by pretending to be smitten yet financially needy), animal companionship (by selling puppies that do not exist) and financial returns in a low interest-rate environment (by creating fake funds).
Some scams are sophisticated and targeted, extracting money from victims over many months. They may be run by international organised-crime groups, which behave like businesses—some even have arbitration procedures for scammers who feel underpaid, according to Group-IB, a security firm. But Jon Shilland, who works on fraud for the National Crime Agency, also says that many perpetrators are in Britain. They acquire fraud toolkits online or learn from friends: “The bar to entry for a lot of frauds is very, very low.”
A few things are being done to slow the rot. Call centres, which are often targeted by scammers, have bought technology that can recognise people’s voices. Banks can tell when a mobile phone is being held oddly. Google has begun to insist that firms advertising financial services are approved by the Financial Conduct Authority. But that is “not a high bar”, says Anne Boden, the boss of Starling, an online bank. The internet is still awash with fraudulent ads, which cost both customers and their banks money. In the first half of the year 42% of all the money lost to authorised frauds was reimbursed, according to UK Finance.
Respected organisations behave in ways that confuse people and soften them up for fraud. The National Health Service has sent millions of text messages with links to book covid vaccines. “We spent ages saying don’t click on links in text messages,” says Brian Dilley, the head of fraud prevention at Lloyds Bank. On November 17th the technology firm Amazon, which was in a commercial dispute with Visa, a credit-card company, encouraged many customers to change their payment method by clicking on a link.
The resources devoted to the problem are dwarfed by its scale. Fraud and computer misuse account for 58% of crime experienced by the public, according to the Crime Survey. In 2018 the Police Foundation, a think-tank, found that just 0.8% of police staff worked on economic crime.
The cost of mass fraud is paid in lost money, higher charges for financial services and distress. And there could be another effect, which is hard to measure but pernicious. Mr Shilland worries that people are becoming so suspicious that companies and agencies such as the tax office are finding it hard to reach them. A growing proportion of legitimate communications are being reported as fraudulent. Fraudsters have even tried to impersonate the National Crime Agency.■
This article appeared in the Britain section of the print edition under the headline “Criminally under-policed”