Romance scams cost Brits £108m in 2024

Editorial

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Romance fraud is a growing financial crime, with cases rising by 9% last year. Victims are deceived into sending money to fraudsters who engineer false romantic relationships or friendships, usually through social media and dating sites.

One of the cases the FCA reviewed involved a victim losing more than £428,000. In another, the victim made 403 payments to a fraudster over the course of a year, resulting in losses of over £72,000. The firm’s investigation acknowledged that it had not identified the sustained, out-of-character activity.

The watchdog says that intervention and prevention are made difficult for firms because victims may be ‘under the spell’ of the fraudster and reluctant to accept they are being defrauded. In nearly half of the cases the FCA reviewed, victims did not disclose the true reason for making a payment when asked.

Companies are often doing a good job of tackling the issues, but the regulator found multiple examples of missed opportunities to spot suspicious transactions.

“This indicated that firms could calibrate their monitoring systems to be more effective,” says the FCA, which adds that some providers need to do better at training staff to spot red flags and probe customer explanations.

Steve Smart, executive director, enforcement and market oversight, FCA, says: “Romance fraud is a vicious crime. All too often it is the vulnerable that fall victim. The impact – financially and personally – can be devastating. We recognise the challenge banks and payment firms have in combating this complex crime and this review aims to help them stay one step ahead of the criminals.”