3 MIN READ

House of Lords committee slams permissive culture towards fraud

fraud problem

Fraud is a pervasive problem that affects countless individuals and businesses every year. In fact, it’s the most commonly experienced crime in the UK, accounting for 41% of all crimes recorded against individuals. Despite the seriousness of this issue, a “permissive culture” still exists around fraud, according to a recent report from the Digital Fraud Committee.

The report calls for a new criminal offence of “failure to prevent fraud” to be introduced in order to encourage all relevant industries to play a more active role in protecting customers from fraud. The telecoms sector, which is often involved in large-scale scams, was singled out for criticism and urged to do more to combat spoof calls and scam messages. The technology sector as a whole was also warned to do more to prevent fraudsters from using online ads and social media to lure in their victims. One sector that has been particularly affected by fraud is the financial services industry. 

Why Banks are Changing their Approach to Fraud Refunds

While banks have been “bounced into action” due to the number of reimbursements they have had to provide to fraud victims, there is still a long way to go. Before the recent surge in refunds, banks were not forthcoming when it came to compensating fraud victims.

To tackle the current fraud problem in the UK, banks should delay payments that meet specific criteria regarding amount, destination, and recipient. This delay will allow banks time to conduct additional checks and contact customers if necessary. However, if fraudulent payments still manage to slip through, liability shouldn’t solely rest on the shoulders of the bank.

The Need for a Nationwide Awareness Campaign to Combat Fraud

One of the key recommendations from the Digital Fraud Committee is the need for a centrally-led public awareness campaign. Raising public awareness of the risks and the tactics used by fraudsters could help  reduce the number of cases. The current level of confusion surrounding the different bodies has made it easier for criminals to avoid detection. A nationwide campaign would help to unite efforts against fraud and give people the tools they need to protect themselves.

While it’s encouraging to see the committee taking a stance, it’s important to remember that prevention is better than cure. Obtaining refunds for fraudulent activity is difficult and time-consuming, and there’s no guarantee that you’ll get your money back. Therefore, it’s essential to take steps to protect yourself from fraud in the first place.

Why Preventing Fraud is Better than Dealing with its Consequences

There are several measures you can take to reduce your risk of falling victim to fraud. First and foremost, always be wary of unsolicited phone calls, emails, and text messages. Never give out personal information to anyone you don’t know or trusts, such as your bank account details or passwords. Be cautious when making online payments, and only use trusted websites and payment providers. Monitor your accounts and credit report actively to detect any unusual activity as early as possible.

The recommendations are a step in the right direction but it’s up to us to take responsibility for ourselves. By taking proactive measures, we can reduce our risk of becoming victims and avoid the difficulty of obtaining refunds.

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