Comment in response to Which? APP fraud statistics

While scam prevention importantly remains at the top of the agenda for the financial services sector, scams don’t occur at the point of payment. The social engineering so often used, together with the evolving sophistication of scams, are convincing enough to make a payment, and the circumstance in which it comes about, appear genuine. By point-of-payment the customer has committed.

There are multiple organisations involved in this customer journey, meaning there are multiple opportunities to save that person from financial and emotional harm. Other sectors must now come together with financial services providers and understand where the ‘danger spots’ lie within the customer journey, so that each organisation can take responsibility for intervention at the right point.

APP scams cause significant financial and emotional distress, with the victim’s experience so often associated with feelings of guilt, shame, worry, and embarrassment. The Contingent Reimbursement Model Code (CRM Code) overseen by the LSB, is currently the only set of protections in place for consumers to detect, prevent and respond to APP scams. Reimbursement alone, although vital in reducing financial harm, cannot expunge the feelings of distress and shame that these scams cause.

Clearly it would be better if we could prevent these distressing scams from happening in the first place. Signatory firms continue to work on detection and prevention measures for their customers, and we urge other financial service providers to sign up to the Code and do the same.

Cross sector collaboration is key to making scam prevention a reality and avoiding the devastating impact to customers. We stand ready to continue working with the industry to ensure better customer outcomes.

Emma Lovell, Chief Executive, Lending Standards Board