P2P payment fraud

Fraud that uses person-to-person payment apps to take money from people.

For example, a scammer might persuade someone to send money through a payment app, or take over someone's app account and send their balance away.

Fraud involving peer-to-peer (P2P) payments, which are fast transfers between individuals through banking or payment apps. These payments are often instant and difficult to reverse once sent.

P2P fraud falls into two broad types:

• Unauthorized fraud, in which a criminal takes over an account or steals credentials and sends payments the owner never approved.
• Authorized push payment (APP) scams, in which the victim is tricked into sending the money themselves, for example by someone posing as a bank, a seller, or a loved one.

Common scenarios include:

1. Impersonation scams, in which a fraudster pretends to be a bank or a government agency and says the victim must move money to stay safe.
2. Purchase scams, in which a fake seller takes payment and never delivers.
3. Romance and friend scams, in which a fraudster builds trust and asks for money.
4. Account takeover, in which a criminal drains a balance from a hijacked account.

Rules on who bears the loss differ by place:

• United Kingdom. Since October 7, 2024, payment providers must reimburse most victims of authorized push payment scams on Faster Payments and CHAPS, up to £85,000, with the cost split between the sending and receiving firms.
• United States. Banks are generally not liable when a customer authorized the payment, even if they were deceived into doing so.

P2P fraud sits next to terms that are easy to mix up:

• Account takeover (ATO) is one way P2P money gets stolen, through a hijacked account.
• Money mule is an account that receives and passes on the stolen funds.
• Step-up authentication is an extra check that can slow a risky payment.