The UK government is being urged to set up a National Anti-Fraud Centre to halve the rate of the crime by 2028.
Industry body Innovate Finance has launched a blueprint to make the UK the world leader in tackling fraud, and is urging ministers to prioritise cross-sector data sharing and shared liability in a bid to tackle the £1.2bn annual problem of payments fraud.
Titled ‘A Technology Strategy to Smash Fraud’, the plan aims to halve fraud in the UK by 2028 and ensure the UK is the safest place in the world to use digital finance.
It includes a data sharing approach across sectors, regulators and law enforcement industry, to industrialise tech to spot and stop fraud, and enable finance firms of all sizes to have access to use solutions.
Key points include shared liability for social media and telecommunications platforms for fraud originating on their platforms and networks – where the majority of all frauds take place – and strengthening the Online Safety Act, Innovate Finance argues.
Janine Hirt, CEO at Innovate Finance, said: “Fraud accounts for over 40 per cent of crime but receives less than 1 per cent of police resources.
“Given the scale of the threat posed to consumers and businesses alike, we urgently need a more collaborative, targeted, and effective strategy that aspires to smash fraud in the UK.”
She added: “This plan sets out how we can harness technology via data sharing to strengthen collaboration between industry and law enforcement.
“Critically, there is nothing in place with the critical mass or scale required to crush organised fraud. There is widespread agreement that establishing a National Anti Fraud Centre would be the appropriate vehicle to deliver this.”
And she argued: “We also need to update our laws, including the Online Safety Act 2023, to make tackling crime a shared responsibility between payment providers and the social media and telecommunications firms that allow fraud to take place on their platforms.
“By acting now, the UK government can lead the way in tackling fraud, protecting consumers and reinforcing its position as a global leader in secure and innovative finance.”
A National Anti Fraud Centre would scale-up, connect and industrialise the range of initiatives in the fraud data sharing space and ensure that these are easily accessible by firms of all sizes, according to Innovate Finance, as opposed to a focus on large firms.
And the strategy also calls for the introduction of new shared liability rules to ensure big tech, social media and telecommunications firms tackle fraud conducted on their platforms.
Currently, some 77 per cent of authorised push payment (APP) fraud originates online, with digital social platforms the single largest source of fraud origination, despite payment service providers (PSPs) being currently held solely responsible for reimbursing victims of fraud.
Innovate wants the government to address this via amending the Online Safety Act 2023 to introduce a reporting framework, enable cross-industry data sharing and analysis, set up a fraud origination redress fund, create a distribution mechanism and establish a dispute resolution process.
They argue the strategy will reinforce the UK’s international competitiveness as a safe place to invest, and promote developing new anti-fraud regulatory technology solutions, in a significant economic opportunity for Britain.