Over the last three months, The House of Lords, European Commission and the Payment System Regulator (PSR) published detailed reports and proposals on how to prevent instant payment fraud. It is not easy and requires multiple partners to work together and consumers and business to do their part to stop these escalating frauds by having robust, mandatory, focused incentives.
Fraudsters without a bank account have no ability to scam Consumers; the faster payment needs to go to another bank account. To run an APP fraud business of £500 million, growing at 30% per year you need thousands of bank accounts. Clearly the banks are not fulfilling their duty of ‘Know Your Customer’.
The fraudsters then use the participants in the chain – social media platforms, telecom and ISP – to contact consumers and businesses to defraud them. The participants allow fake paid for ads, emails, texts and spoofing telephone numbers of legitimate people and businesses over old, existing telecom systems.
The banks have groomed the consumer by asking for their details when they make the call for “security purpose”. Payment systems that do not verify the actual owner of the bank account and an attitude the scammed are to blame.
The Policing of digital scams needs to be accelerated. Traditional, analogue, crime is declining. Electronic scamming is such most of the adult population has experienced or heard about it. Having less than 1% of the Police resources managing 40% of crime is a complete imbalance.
To this end, participants in the fraud chain – social media platforms, telecoms and ISPs - need incentives to stop fraudsters’ scams. Fines, similar to banks open accounts for scammers, for carriers of fake and misleading ads should become mandatory. The EU new proposals for 2023 include fines of up to 10% of the global revenue for s ..
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