Authorized Push Payment and Social Engineering Scams
When fraud occurs as a result of scams and social engineering, organizations can struggle to stop it. This is because when legitimate customers fall prey to online imposter scams—for instance, in the case of authorized push payment fraud (APP)—the impact from losses can snowball, affecting not just the customer, but the organization at which the fraud took place.
In fact, according to the FTC, American consumers reported losing over $2.3B to imposter scams in 2021. Meanwhile, across the pond, UK Finance reported that losses due to authorized push payment fraud rose by 71% in the first half of 2021 in the UK, the same report stating that the amount of money stolen through this type of scam even overtook card fraud losses.
Ultimately, financial institutions need to find ways to effectively combat thes massive losses that can come from APP fraud before they’re left footing the bill.