- One in five (21%) adults have been victims of fraudsters in the last three years, according to a landmark global report which surveyed 28,000 people across 15 countries.
- More than 10 million people have been hit by fraud in the UK alone in the last three years – losing an average of over £900 each.
- UK Government must lead the drive for a new international agreement to crackdown on criminal gangs behind tidal wave of fraud, according to the Social Market Foundation report commissioned by Santander UK.
With just a week until the new mandatory fraud reimbursement rules come into force, the Social Market Foundation (SMF) – a cross-party think tank – in partnership with Santander UK, has today published the first-of-its-kind ‘It’s a Fraudster’s World Report’. Through data from a survey spanning 15 countries and 28,000 respondents, the SMF has revealed the global nature of the ‘fraudemic’, and the action that the UK must take to address it1.
Across 15 countries, over a fifth (21%) of respondents reported having experienced fraud, with £168 billion falling into the hands of fraudsters. When including wider social costs – like the loss in productivity from having to deal with the aftermath of fraud – the 15 economies suffered a total of over £420 billion worth of damages. Beyond the financial loss, 40% of respondents reported feeling less trusting of others after being targeted, and one in ten (12%) reduced their use of the internet and communication technology as a result.
In the UK, the SMF estimates that 10 million Britons fell victim to fraud between 2021 and 2023, costing the wider economy around £16 billion. The average loss for Britons was £907, with a third (33%) reporting suffering a negative emotional impact and 18% an impact to their finances.
Across the countries polled, there was public recognition that - alongside banks and other payment service providers (94%) - other parts of the ‘fraud chain’ including digital platforms (88%) and telecoms and internet providers (84%) have a responsibility for compensating fraud victims for their losses.
International co-ordination on counter-fraud efforts is desperately needed given fraudsters’ ability to act across international boundaries to claim British victims. Experts that SMF spoke to highlighted the problem this causes for UK law enforcement, who are constrained by geography and the costs of trying to navigate the various international arrangements for law enforcement. While Labour’s manifesto pledged a focus on fraud, plans for international collaboration have yet to emerge, which is at odds to other types of economic crime.
The report emphasises the global nature of fraud and reflects Santander’s expertise in fraud across the group. It lifts the lid on the lack of a concerted international effort to tackle the low barriers to entry for fraudsters, and the low-risk and high reward nature of fraud.
As such, the SMF is calling for the UK Government to:
- Push for a comprehensive international agreement, including committing to prioritising and investing more resources into tackling fraud.
- Prioritise the fight against fraud and establish a cross-departmental Economic Crime Leadership Group.
- Boost the law enforcement response to economic crime.
- Ensure that there is an alignment in interests amongst those private sector organisations that make up the ‘fraud chain’, including introducing legal duties on these organisations to ensure that they prioritise fraud prevention and bear relevant costs.
- Ensure that the new ‘Stop! Think Fraud’ public awareness campaign has long-term funding to enable it to continue for the next five years.
- Increase its support for bolstering low and middle-income countries’ anti-fraud law enforcement and regulatory capacity and capabilities.
Stephen White, Chief Operating Officer at Santander UK, said: “The report puts to paper the sheer scale of the fraudemic that we’re seeing. Despite the best efforts of banks and policymakers, the criminal gangs who sit behind fraud are enriching themselves to the tune of billions and costing the global economy hundreds of billions. Fraud has become a global phenomenon, as such it needs global, collective action. The UK is in a prime position to lead this charge, but we need renewed focus on tackling the fraudemic across Government, banks, and the global technology and communication companies that connect criminals with potential victims.”
Richard Hyde, Senior Researcher at Social Market Foundation, added: “Our research presents the clearest picture yet of the scale of the global fraud problem. It is not just the UK that is besieged by fraudsters – both developed and developing countries face huge fraud challenges.
“Any nation acting alone remains ill-equipped to deal with today’s fraudsters, who can operate from anywhere and claim a victim thousands of miles away. To tackle the challenge, governments across the world need to co-ordinate and put in place strong counter-fraud measures at home; this will create the best platform from which the world can deal with cross-border fraud. We believe that the UK can and should facilitate and lead that global movement”.
Ends
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Notes to editors
- It’s a Fraudster’s World Report can be viewed here.
- The report is sponsored by Santander UK. The SMF retains full editorial independence.
- The figures: £168 billion: total direct costs of fraud across 15 countries between 2021 and 2023, where this is the total amount people who were defrauded.
Around £420 billion: this figure includes the wider social costs – such as loss in productivity from having to spend time reporting/addressing the fraud – and was calculated by the SMF using estimations from other sources. Research methods: The SMF’s ‘It’s a Fraudster’s World’ uses results from a 15-country survey (see note 1 for full list and ranking). Specifically, it utilises the results from the questions in the survey about: (a) victimisation; (b) instances of repeat victimisation; (c) average cost to the victims of the only or most recent fraud suffered in each country relative to the worst country; (d) attempted frauds. The international survey included over 28,000 adults.
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Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. At 30 June 2024, the bank had around 19,600 employees and serves around 14 million active customers, including 7 million digital customers via a nationwide 444 branch network, telephone, mobile and online banking. Santander UK is subject to the full supervision of the FCA and the PRA in the UK. Santander UK plc customers’ eligible deposits are protected by the FSCS in the UK.
Banco Santander (SAN SM, STD US, BNC.LN) is a leading commercial bank, founded in 1857 and headquartered in Spain and one of the largest banks in the world by market capitalization. The group’s activities are consolidated into five global businesses: Retail & Commercial Banking, Digital Consumer Bank, Corporate & Investment Banking (CIB), Wealth Management & Insurance and Payments (PagoNxt and Cards). This operating model allows the bank to better leverage its unique combination of global scale and local leadership. Banco Santander aims to be the best open financial services platform providing services to individuals, SMEs, corporates, financial institutions and governments. The bank’s purpose is to help people and businesses prosper in a simple, personal and fair way. Banco Santander is building a more responsible bank and has made a number of commitments to support this objective, including raising €220 billion in green financing between 2019 and 2030. In the first quarter of 2024, Banco Santander had €1.3 trillion in total funds, 166 million customers, 8,400 branches and 211,000 employees.