Fraud
Industry NewsThe report highlights significant difference in firm performance before the new rules came into force in October 2024.
Key insights include:
➡️ Reimbursement Rates (Pre-Policy): 60% of APP scam losses were reimbursed by value and 73% by volume, meaning a substantial proportion of victims did not recover their funds;
➡️ Inconsistent Outcomes: Reimbursement levels varied significantly between firms, with customer outcomes heavily dependent on their bank;
➡️ Fraud Losses: £145m was lost to APP scams in the first half of 2024, an 18% decrease compared to H1 2023. Case volumes fell 13% year-on-year;
➡️ Receiving PSP Risk Concentration: Non-directed firms recorded fraud rates by value 41 times higher than the largest 14 banking groups;
➡️ Scam Typologies: Purchase scams accounted for 73% of cases, while investment scams represented 25% of total fraud value despite only 4% of cases;
➡️ Policy Impact (Since October 2024): Early data under the reimbursement regime shows 88% of in-scope losses returned to victims (£173m), with 82% of claims closed within five business days; and
➡️ Ongoing Oversight: An independent evaluation of the APP reimbursement policy is underway, due to conclude in Q2 2026, with further consultation on APP scam data planned in Q1 2026.
✅ Firms should assess pre-reimbursement performance trends, particularly exposure to receiving fraud risk and investment scam typologies, to ensure controls, reimbursement frameworks and fraud prevention measures align with the regulatory expectations.
💡 Plenitude’s Fraud Prevention Services conduct independent assessments of existing strategies, rules, technology and operational processes to improve fraud detection rates, enhance the customer experience and reduce fraud losses. Visit our website for more information: https://www.plenitudeconsulting.com/services/fraud-prevention-services
