The New UK Fraud Strategy Call for Evidence - Which?’s response

Which?’s recommendations for the next fraud strategy, supported by 24,699 members of the public

Fraud causes major harm to consumers. Industry data suggests that account holders lost almost £460 million to authorised fraud in 2023, while Which? data estimates that the damage to emotional wellbeing amounts to approximately £9 billion per year. The government’s latest crime figures suggest the problem is growing: fraud increased by 33% between 2023 and 2024.

The best way to reduce this harm to consumers is to prevent fraud from happening in the first instance. All players in the fraud ecosystem - internet companies, telecoms networks, and payment service providers - can prevent fraud by adopting measures that make it harder for fraudsters to target consumers and by sharing relevant fraud information with one another and with the authorities.

In its next fraud strategy, the Home Office should focus on protecting consumers by putting in place a regulatory framework that provides meaningful incentives for individual sectors to adopt stronger fraud prevention measures. In particular, it should:

• maintain payment service providers’ existing incentives to prevent fraud by keeping robust redress mechanisms in place via the mandatory reimbursement scheme for APP fraud;
• provide the largest online platforms with fraud prevention incentives by ensuring that there are no further delays to the Online Safety Act’s fraudulent advertising codes of practice (including legislating to prevent such delays if necessary);
• legislate to provide internet companies outside the scope of the OSA with incentives to prevent fraud;
• review the regulatory regime around bulk texting to assess whether telecoms companies require additional legislative incentives to prevent fraud; and
• ensure via legislation that Over-The-Top providers such as WhatsApp or Signal have the same incentives to prevent fraud as other telecoms operators.

Data sharing is an important part of the fraud puzzle. The Home Office must drive forward cross-sector data-sharing to prevent fraud and lead by example in sharing its own data.

The Home Office must provide central, overarching leadership to tackle fraud. In particular, it should:

• commit to identifying and removing gaps in its regulatory approach to fraud, so that fraudsters cannot simply target the ‘softest’ parts of the fraud ecosystem;
• take a central leadership role to bring together the various data sharing initiatives under the same mission by the end of 2025;
• establish clear timelines, governance processes, and accountability frameworks for delivery of the strategy; and
• hold other departments, regulators, and industry to account if they fail to deliver what is needed of them.

The strategy must be ambitious in its aims. The Home Office should aim to halve the number of APP cases from a baseline of 232,429 in December 2023 (the most recent annual dataset) by the end of this Parliament.