A senior HSBC executive has joined other banking leaders in urging technology and social media companies to contribute to the compensation of victims of Authorised Push Payment (APP) fraud.
APP fraud has surged in recent years, with losses in the UK exceeding $500 million in 2023. In response, regulators are implementing new rules for the banking sector, which will mandate that the majority of funds lost to APP fraud be reimbursed to victims starting in October.
UK banks have been advocating for technology firms, social media platforms, and telecommunications companies to take greater responsibility for the fraud that emanates from their platforms. According to UK Finance, 76% of APP fraud incidents occur online, with another 16% linked to the telco sector.
David Callington, HSBC UK’s head of fraud, has emphasized the need for accountability among key players in the ecosystem, stating, “They [tech firms] need the financial incentive.”
In response to escalating scam levels from fake advertisements and romance fraud, 11 tech and social media companies signed a UK Online Fraud Charter last year. Nonetheless, UK Finance is calling for more stringent government measures based on this voluntary charter to create enforceable obligations.
Callington added, “What we would urge for is a shifting of some of those obligations into regulation, so there is an actual obligation on other sectors who are part of the ecosystem to take action and protect what are our common customers, our common users.”