Fraud Strategy shifts the burden upstream – and banks are in the firing line

The UK’s caller Fraud Strategy is not conscionable a tougher stance connected criminals, it is simply a blueprint for pushing fraud prevention onto the infrastructure providers that whitethorn alteration frauds to scale. For banks, the connection is clear: reimbursement is nary longer the extremity of the story, prevention is becoming a halfway marketplace obligation.
Fraud has go excessively ample for the UK’s instrumentality enforcement to grip alone. The Government’s Fraud Strategy 2026-2029 (the “Strategy”) describes fraud arsenic the UK’s largest transgression type, with an economical outgo of astatine slightest £14.4bn successful 2023-24. The Strategy commits implicit £250m from 2026-2029 and involves 3 pillars: Disrupt, Safeguard and Respond. For banks, the astir important connection sits beneath that structure: fraud prevention is moving upstream.

It is yet different compliance displacement for a assemblage already expected to transportation retired diligence connected customers, show and observe suspicious transactions, and supply reimbursements. The Strategy points to thing adjacent broader; the expanding anticipation that banks person fraud controls embedded into merchandise design, onboarding journeys, outgo flows, authentication, relationship security, lawsuit communications and mule detection. Reacting good aft a fraud lawsuit volition not beryllium enough.

From reimbursement to prevention

On the fiscal services sector, the Strategy is polite astir the advancement banks person made. It recognises the Retail Banking Fraud Charter of 2021, Confirmation of Payee, the Banking Protocol, and the mandatory reimbursement authorities for eligible authorised propulsion outgo frauds (“APP Fraud”), which returned £173m to victims successful its archetypal year. But the aforesaid conception makes wide that the existent attack has not solved the problem. At slightest £629.3m was stolen successful the archetypal fractional of 2025 alone, including £371.8m of unauthorised fraud.

The Government is present asking why, contempt these efforts, fraud continues to get through. A Home Office Call for Evidence connected APP Fraud is owed successful 2026. The Financial Conduct Authority (“FCA”) is expected to see bully and mediocre signifier successful preventing APP Fraud and wealth mules. HM Treasury intends to repeal the existing Strong Customer Authentication method standards, allowing the FCA to incorporated caller standards geared towards a much agile, outcomes-focused approach.

This is the absorption of question for banking. The question volition not lone beryllium whether a slope met a prescriptive, static, control, it volition beryllium whether its controls adapted arsenic the fraud menace changed.

The emergence of the “enabler” lens

One of the astir commercially important themes successful the Strategy is the unit connected businesses arsenic imaginable fraud enablers, not conscionable victims.