UK Finance has called for new legislation to make online platforms responsible for taking down fraudulent content and better protect consumers from financial fraud.

Criminals have used the COVID-19 pandemic to target victims online, through impersonation scams, romance fraud and investment scams.

New figures from the banking body revealed that in 2020, Authorised Push Payment (APP) fraud losses amounted to £479m, a total up by 5% on the previous year.

Banks and other finance providers were able to return £206.9m of the losses from APP fraud to victims, which was over three-quarters more than the sum returned in 2019. Almost £7 in every £10 of attempted unauthorised fraud was also blocked by the banking industry last year. The figures showed that unauthorised fraud fell by 5% to £783.8m in 2020, with the banking industry stopping £1.6bn of losses.

However, UK Finance highlighted that criminals have turned to online and technology-enabled scams to exploit people’s fears about the coronavirus pandemic.

“We are seeing a worrying rise in online and technology-enabled scams that evade banks’ advanced security systems and use digital platforms to target victims directly, tricking them into giving away their money or information,” commented UK Finance managing director of economic crime, Katy Worobec.

Impersonation scam cases, in which criminals impersonate trusted organisations to trick victims into handing over their money, almost doubled to 39,364 cases in 2020, the largest increase of all scam types.

During the pandemic, criminals have also sent fraudulent emails claiming to offer government support to those impacted by the pandemic, as well as scam text messages requesting payments to book a COVID-19 vaccine. UK Finance also recorded a 32% increase in investment scam cases last year, which are often promoted through adverts on search engines offering higher than average returns, and a 38% increase in cases of romance scams, driven by the rise in online dating during the pandemic.

The banking body has called for fraud to be included in the scope of the government’s Online Safety Bill to better protect consumers from these scams.

Worobec added: “We urge the government to use the upcoming Online Safety Bill to ensure online platforms take action to protect customers by taking down scam adverts on search engines, removing fake profiles on online dating websites and tackling fraudulent content on social media.

“It cannot be right that online firms are effectively profiting from fraud, while society as a whole pays the price.”

Commenting on the UK Finance figures, AJ Bell senior analyst, Tom Selby, added to the calls for government intervention, suggesting the creation of a Minister for Scam Prevention role.

“The political response to this ever-present but evolving threat is often piecemeal, in part because the issues span different areas of government,” Selby said. “The decision to not include financial scams in the Online Safety Bill, for example, has been met by understandable incredulity by campaigners.

“Given the rising incidence of scams, we believe there is a strong case to be made for creating a Minister for Scam Prevention role.

“This would ensure direct ministerial responsibility for addressing the scams epidemic, ensuring interventions are focused in the right areas and help join thinking across different departments.”

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