Innovate Finance has called on the UK government to establish a National Anti-Fraud Centre for cross-sector data sharing and introduce shared liability for social media and telecommunications firms in the fight against financial crime. The proposals form part of a comprehensive strategy titled “A Technology Strategy to Smash Fraud,” which aims to halve fraud in the UK by 2028.
The organisation argues that current anti-fraud initiatives operate in isolation, preventing the creation of the “critical mass” or “scale” needed to effectively combat organised fraud across the financial services sector.
Data Sharing Strategy and Central Leadership
Innovate Finance has proposed what it describes as a “world-first” data sharing approach across sectors, regulators, and law enforcement to “industrialise the UK’s use of technology to spot and stop fraud.” The strategy calls for central leadership across various data-sharing initiatives, combined with effective data sharing, collection, and analysis between finance firms, regulators, law enforcement, technology platforms, and telecoms networks.
Janine Hirt, Chief Executive Officer of Innovate Finance, highlighted the scale of the challenge facing the UK:
“Given the scale of the threat posed to consumers and businesses alike, we urgently need a more collaborative, targeted, and effective strategy that aspires to smash fraud in the UK. This plan sets out how we can harness technology via data sharing to strengthen collaboration between industry and law enforcement. Current data sharing initiatives, while effective, operate in silos, which can make it difficult in practice.”
Hirt emphasised the need for a coordinated approach:
“Critically, there is nothing in place with the critical mass or scale required to crush organised fraud. There is widespread agreement that establishing a National Anti Fraud Centre would be the appropriate vehicle to deliver this.”
Shared Liability for Tech Platforms
A key component of the strategy involves introducing shared liability for social media and telecommunications companies when fraud originates on their platforms. Currently, whilst digital social platforms represent the single largest source of fraud origination, payment service providers are typically held solely responsible for reimbursing victims.
Recent data from Revolut demonstrates the scale of the problem, showing that Meta platforms (Facebook, Instagram, WhatsApp) collectively accounted for 54% of all scams reported to the firm globally. Overall, 77% of Authorised Push Payment (APP) fraud originates online.
The strategy calls for amendments to the Online Safety Act 2023 to establish a fraud origination redress fund, requiring telecommunications firms and social media platforms to contribute to reimbursements for fraud victims.
Hirt explained the rationale for shared responsibility:
“We also need to update our laws, including the Online Safety Act 2023, to make tackling crime a shared responsibility between payment providers and the social media and telecommunications firms that allow fraud to take place on their platforms.”
Resource Allocation and Industry Support
The proposals address a significant disparity in resource allocation, with fraud accounting for over 40% of crime but receiving less than 1% of police resources. The strategy aims to ensure that all financial firms, regardless of size, can access and utilise anti-fraud solutions, rather than current initiatives that focus primarily on larger institutions.
Luke Charters, MP for York Outer, supported the initiative, describing the pain and distress caused by fraud as “immeasurable”:
“Effectively countering this threat requires a coordinated, cross-sector response, leveraging expertise from financial institutions, regulatory bodies, law enforcement and policymakers alike. To effectively combat fraud at scale, I believe we should establish a national anti-fraud centre. By uniting insights, intelligence and expertise from across industries, this centre could serve as a formidable force against fraudsters, enabling real-time threat detection and disruption.”
Economic and Strategic Benefits
Beyond consumer protection, Innovate Finance positioned the strategy as an opportunity to build a “world-beating” UK anti-fraud technology industry that could create jobs, drive growth, and export solutions globally.
Hirt outlined the broader strategic vision:
“The aim of the strategy is to not only reinforce the UK’s international competitiveness as a safe place to invest, but also frame the focus for the UK to develop and export new anti-fraud regulatory technology (RegTech) solutions.”
The RegTech sector, a subset of fintech, is projected to be worth $246 billion globally by 2032, according to Innovate Finance, representing a significant economic opportunity for the UK.
Implementation and Funding
The proposed National Anti-Fraud Centre would require accountability at the highest levels of government and funding mechanisms that “do not add pressure to the public purse.” The centre would serve to “scale-up, connect and industrialise” existing fraud data-sharing initiatives whilst ensuring accessibility for firms of all sizes.
The strategy also calls for the establishment of a reporting framework, dispute resolution processes, and distribution mechanisms for reimbursements from responsible parties, creating a comprehensive ecosystem for fraud prevention and response.
Hirt concluded with a call for immediate action:
“By acting now, the UK Government can lead the way in tackling fraud, protecting consumers and reinforcing its position as a global leader in secure and innovative finance.”
