Fraud in the UK: What is the scale of the problem across the country?

Daniel Marchetti, Principal Business Solutions Manager, EMEA AML & Fraud, SAS

Fraud cases in the UK have increased substantially over the last two years. Scamming techniques used by perpetrators are constantly evolving, meaning they’re becoming more sophisticated, and, as a result, can be more difficult for businesses to contain.

In fact, more than half (64%) of British businesses have experienced fraud, corruption or financial crime in the last 24 months, according to one study.

Behavioural changes brought about by the coronavirus pandemic may have exacerbated the number of cyber-related fraud cases, as more people operate online rather than in-person across numerous devices, and hybrid working becomes the norm.

Fraud often increases during times of economic difficulty, which is currently being felt by consumers and businesses across the country as the cost-of-living crisis bites. The UK is on the brink of a recession, which can lead people to be more financially vulnerable, prompting fraudsters to strike. It may also drive more opportunistic fraud.

While many people associate financial crime with computer misuse, or phishing attempts, some fraudsters will also target mobile phones due to the volume of personal information held on them. From banking app log-in credentials to photographs, stolen phones can lead to identity theft and bank accounts being emptied.

With the rise in hybrid working, bring-your-own-device (BYOD) has seen more people use personal devices for work activity. But this can also lead employees to expose the business to risk – e.g. if a criminal steals a device that can give it access to the employee network. 

How Artificial Intelligence (AI) can help in the fight against fraud

AI can help businesses to tackle fraud by detecting, preventing and managing cases in real-time.

When fraud is suspected, AI can combine with machine learning to spot and thwart sophisticated or nuanced attacks before they happen, and flag it to the relevant teams for further investigation.

Police forces are also using AI to identify potential fraud hotspots, and use evidence-based policing to combine traditional policing with AI to improve resource allocation, and identify fraud trends faster and more accurately, such as victim demographics and opportunities for fraud prevention.

The geographic range of fraud across the UK

According to the National Crime Agency, fraud is not only prevalent but now the most “commonly experienced crime in the UK.”

As the Government looks to tackle the complex issue of fraud by harnessing the capabilities of private and public sector businesses, which locations are seeing the biggest rise in the crime?

Using Police Force data referred to the National Fraud Intelligence Bureau (NFIB), SAS analysed thousands of fraud cases to understand how the picture looks, both regionally and on a national scale.

In November 2022, there were 27,909 cases of fraud referred by police forces to NFIB in the 45 largest police forces across the UK. This is actually 5% less than the same period a year before - when the figure stood at 29,395. However, this does not take into account miscellaneous referrals which are not attributed to a particular police force.

Regionally, the figure varies. Police Scotland had the highest increase - with 67% more fraud referrals than the previous year at 1,200, up from 716. Police Scotland comprises 13 geographical divisions - including Edinburgh, Fife, Highland and Islands, Greater Glasgow and Ayrshire.

The force in Gwent, Wales, followed shortly after with a more modest 21.6% increase. The City of London, Durham and Gloucestershire also had high increases in reported fraud.

At the other end of the spectrum, Dyfed-Powys in Wales had the biggest drop in fraud cases referred to the NFIB, from 507 in November 2021 to 286 in November 2022 - a fall of 43%.

Humberside Police, which covers four authorities of Kingston upon Hull, East Riding of Yorkshire, North Lincolnshire and North East Lincolnshire, also experienced a decline in referred fraud cases - from 502 to 357. 

Fraud across the UK: Where is it increasing the most?

Fraud across the UK: Where is it decreasing the most?

Phone theft is a growing problem, post-pandemic

There has been a significant rise in phone theft over the 12 months. Fraudsters then log on to the banking app of the phone they have stolen, changing the details and using it as their own.

Criminals may also try to access investment apps, social media and email accounts, and hold the original owner to ransom.

SAS conducted Freedom of Information requests to all city police forces across the UK, to reveal how phone theft has changed in the last year and to understand the true scale of it. 

Overall, the research shows that there has been a 31% increase in phone theft across the UK in the last year. 

In London, across all boroughs, there were 44,629 cases logged in 2022 up to November - almost 10,000 more than in the whole of 2020 when lockdown was prevalent, and an 8% increase compared to 2021.

In Westminster, there were 16,454 cases in 2022 - up from 12,269 in 2021 and 10,176 in 2020, during the pandemic.

Liverpool, however, has had the biggest increase in the last year, with crimes involving stolen phones up by 418%. Coventry, Wolverhampton, Birmingham and Cambridge all saw cases double in the last calendar year.

Meanwhile, Bangor, Ely, St Albans and the London Borough of Hackney all saw the biggest drop in cases.

The biggest increase in phone thefts across the UK

How phone thefts look across London

Successful fraud investigations use cloud analytics to understand the complex techniques, mediums used and common victim profiles, so they can successfully prevent criminals from carrying out attacks by establishing their MO.

It’s crucial for the police to be able to stay on top of rapidly developing new criminal techniques, because financial crimes are often complex enough. With a shortage of police on the front line and fraud investigations requiring specialist skills, having a single platform that allows law enforcement to interrogate large amounts of data and identity opportunities for fraud prevention is critical in the fight against financial crime.

Ends

Methodology

To find out the areas where fraud and phone theft is a growing crime, SAS conducted Freedom of Information (FoI) requests to all city police forces across the UK asking them:

• Instances of fraud cases reported
• Instances of stolen phones reported

Where the data was not available due to the allocated time for each FoI, SAS consulted the National Fraud Intelligence Bureau (NFIB) live database for police records over the last 13 months.  To ensure accurate comparison, we looked at the cases in a full month in November 2021 and in November 2022.

In London boroughs, FoI data given was for 2018, 2019, 2020, 2021 and 2022. In all other cities, data was given for the calendar years 2018/19, 2019/20, 2020/21 and 2021/22.  

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