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The Actuary The magazine of the Institute & Faculty of Actuaries

6 million victims of financial fraud in the UK

It has been found that 12% of UK adults (5.9 million people) have been victims of financial fraud, with one in 10 saying that at least one of their online accounts has been hacked according to Gocompare.com.

Financial fraud "a growing problem in the UK" ©Shutterstock
Financial fraud "a growing problem in the UK" ©Shutterstock

Their research also found that 66% of adults admit to sharing personal information such as birthdays, anniversaries and names on social media, which are used to create passwords and pins.

In addition only 29% create strong passwords containing a combination of letters, numbers and symbols, with 12% not thinking their online passwords are strong enough.

Gocompare.com head of money and protection, Matt Sanders, said: “Financial fraud comes in many guises – from crooks using stolen credit cards to increasingly sophisticated digital scams and is a growing problem in the UK.

“According to the latest figures from the national fraud and cybercrime reporting centre, Financial Fraud Action UK, more than one million incidents of financial fraud occurred in the first six months of 2016.  That’s a 53% increase year-on-year.”

The most common types of financial fraud include:

Card-not-present fraud: This occurs when card details are fraudulently used to make purchases that don’t require you to physically present a card. Criminals fraudulently obtain card details using a range of tactics such as recording card details during a legitimate transaction or downloading malware onto the victim’s computer
Lost and stolen cards: Fraudsters use a lost or stolen card to make a purchase or withdraw cash
Card ID theft: Fraudulently obtained personal information is used to deceive the card company and the fraudster can carry out transactions from the account or open a new one
Card not received fraud: Cards may be stolen in transit between the card issuer and the genuine card holder
Cash machine fraud: Criminals target ATMs to steal cards and card data, using tactics such as peering over someone’s shoulder to see their PIN, then stealing their card, or the use of devices attached to an ATM which copy or ‘skim’ card details and the PIN number, then trapping the card in the machine
Counterfeit card fraud: This involves criminals creating a fake card using details from the magnetic strip of a genuine card
Phishing: Typically, phishing emails come from someone pretending to be a reputable company and usually ask you to enter your account details
Vishing: Fraudsters phone a victim using Voice over Internet Protocol (VoIP), which is where voice calls are made over the internet rather than using a landline, and persuade the victim to give out personal information and account details
SMiShing (SMS phishing): This is similar to the previous two types of fraud, except it's carried out via text message
Malware: Malware or malicious software is when a computer virus is installed on to your computer without your knowledge.  This enables fraudsters to steal personal information or perform actions through your device.  

It is recommended that people protect their personal information, account numbers, passwords and pins, regularly review financial statements, use online safety measures, and be suspicious of unsolicited contact.

“Fraud can have a devastating impact on victims – both financially and emotionally. Being aware of the different types of scams and knowing the warning signs to look out for, can help people avoid falling victim,” Sanders continued.

“And, once people appreciate how easy it can be for criminals to piece together personal data gleaned from online profiles, such as those shared on social media, they tend to be more cautious about openly sharing their personal information.”