Banking fraud
are still suspicious at that point, they will officially invoke the Banking Protocol, with police coming in for a chat. This last step is important. Criminals will sometimes have manipulated their victims into believing that bank staff are themselves involved in a plot to defraud them. But with the full force of the law behind them, officers can often lift the pall from their eyes.
Chris Hubbard, head of fraud at Danske Bank.
Brian Dilley, group director of economic crime prevention at Lloyds Banking Group.
Even better, Cooper explains that if someone does realise they are being cheated, they can often help catch their tormentor. Because fraudsters typically wait nearby for their cash, quick action by the police can seize them red-handed. It goes without saying that none of this would be possible without intimate links across banking. At UK Finance, for instance, Farrow and her team liaise closely with the UK’s 45 police forces, as well as high street banks and the Post Office. Training is vital, too. If, after all, tellers are oblivious to the tell-tale signs of anxiety and confusion that haunt many fraud victims, they risk letting crimes go unpunished. No wonder Farrow stresses that any anomalies in training across the industry are quickly quashed. Nor, it should be emphasised, is the UK unique. Across the North Sea, Danske Bank is just one of several Scandinavian banks to join the Swedish Anti-Money Laundering Intelligence Task Force (SAMLIT). Partly adapted from a similar UK scheme, SAMLIT brings together banks and law enforcement to battle financial malfeasance. Like with the Banking Protocol, collaboration is the order of the day, with Hubbard explaining how private institutions and police forces regularly share information on “subjects of interest”. Similar ideas are spreading elsewhere too. Across the Atlantic, for example, the US state of Michigan recently ordered banks to educate customers about common types of fraud and gave them the ability to block suspect transactions until they can be investigated.
Police academy
From SAMLIT to the Banking Protocol, banks and police forces can really make a difference in the eternal struggle against financial crime. In 2020 alone, UK Finance announced that the Protocol had prevented scams worth £45.3m. Yet it would be wrong to surmise that the scheme – or its cousins overseas – are without their pitfalls. An excellent case study is the Banking Protocol itself. Though banks and police can certainly cajole people they think are about to be fleeced, they will sometimes get it wrong.
“In some circumstances, people will genuinely be trying to take their own money out and get quite cross with our tellers,” says Dilley. “But equally, those customers who are actually in the process of being scammed can get angry, as they still don’t realise it’s part of a fraud.” On an even more fundamental level,
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British banks ultimately have no right to block a transaction. Whatever the police or the bank might think, they must relent if a customer insists. Even more significantly, changes in how banking is done are arguably making parts of the Banking Protocol redundant. With 15 brick-and-mortar branches permanently shuttering their doors each week in 2021 – and four in five Brits now using online banking – fraudsters are increasingly switching from in-person crime to phone or digital alternatives. Yet if UK remote banking fraud jumped by 53% in the year to September, Farrow and her team are reacting fast. Last year, they announced that staff working in call centres and in online banking teams would now be encouraged to inform police if they sensed a fraudulent transaction. Over half of police forces across the UK have also signed up to this enhanced version of the Banking Protocol. At the same time, retail banks are making their own moves. At Lloyds, Dilley describes how his team is negotiating with government to give staff more leeway around delaying payouts until their probity is confirmed.
Given how globalised digital banking can be, it should come as no surprise that experts are increasingly liaising across borders to keep customers safe. In February, for example, Greater Manchester Police worked with counterparts abroad to return around £16m to victims of a Bitcoin fraud. The targets lived in Hong Kong, China and Australia, among other countries. Late last year, Interpol announced that specialised police units from 22 jurisdictions had collaborated to arrest around 1,000 suspected fraudsters, intercepting $27m in illicit funds along the way. “To try and prevent fraud,” argues Dilley, “we have to share intelligence, help put evidence packages together, and really focus the work to take down the criminal gangs who are responsible for large volumes of it rather than just trying to address each [case] individually.”
More than these dramatic police actions, though, Farrow hints that real progress can only ever be made through education. If vulnerable people slam their doors (or internet browsers) in the face of would-be fraudsters, their job suddenly becomes much tougher. It is fortunate, then, that UK Finance is investing so much in teaching people the highways and byways of modern fraud. A case in point is its ‘Take Five to Stop Fraud’ campaign, offering quizzes and leaflets on how to stay safe. That is shadowed by partnerships with several large tech companies, publicising fraud awareness on social media. Yet, as Farrow concedes, her task is never done. “Unfortunately, criminals will seek any opportunity they can to trick people into authorising payments directly to them,” she says, “so it’s crucial that people remain vigilant against these scams.” To put it bluntly, there will likely be more Raymond Dightons in the months and years ahead, even if the man himself has surely learnt his lesson. ●
Future Banking /
www.nsbanking.com
Lloyds Banking Group; Danske Bank
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