Rise of the machines: over 50% of fraud reports in UK are assessed solely by automated systems

Maria Nikolova

During the financial year 2017/2018 there were a total 294,984 reports, of which 181,496 were assessed solely by an automated system.

The fact that novel technologies are invading various spheres of our personal and business life has been underlined by a statement by Rt Hon Ben Wallace MP, Minister of State for Security at the Home Office, who had to reply to a question about the proportion of reports to Action Fraud handled by computer systems.

Layla Moran MP has asked “how many and what proportion of reports made to Action Fraud have been reviewed by (a) a computer system and (b) a member of staff in each of the last three years for which figures are available”.

Rt Hon Ben Wallace MP stressed that no reports are dismissed by a computer system.

He explained that all reports submitted to Action Fraud are processed through an automated triage system that is designed to ensure that resources are targeted at those cases that have the most viable lines of enquiry. An automated process is required due to the large number of cases received (approximately 42,000 per month) to provide an efficient and effective response.

Crime reports to Action Fraud are assessed and triaged through the National Fraud Intelligence Bureau (NFIB) data analytics system which identifies links between seemingly unconnected fraud and cyber crime incidents from all over the country. The first phase of the crime assessment is automated using a computer based algorithm which scores the report’s suitability to be investigated against a number of criteria. The list of criteria includes the victim’s vulnerability, whether the identity of the offender is known, if there is evidence available to support this (e.g. a confirmed bank account money has been paid to), or the volume of reports made about a specific offender.

Reports with the highest viability scoring are then referred for further action by a crime reviewer. The crime reviewers will then undertake further work to identify whether there are sufficient lines of enquiry for the matter to be disseminated to law enforcement. Where opportunities for further action are identified, these crimes are referred to a local police force or other partner agency.

The data provided by Rt Hon Ben Wallace MP shows that over the past several years, at least 50% of such reports were assessed solely by automated systems.

  • During the financial year 2017/2018 there were a total 294,984 reports. Of these reports 113,488 were both system and crime reviewer assessed, the remainder (181,496) were assessed solely by the automated system.
  • During the financial year 2016/2017 there were a total 280,706 reports. Of these reports 128,564 were both system and crime reviewer assessed, the remainder (152,142) were assessed solely by the automated system.
  • During the financial year 2015/2016 there were a total 234,201 reports. Of these reports 117,179 were both system and crime reviewer assessed, the remainder (117,022) were assessed solely by the automated system.

It is barely surprising that heavy volumes of data are managed by automated systems. Such solutions may also be very useful when tackling mundane tasks. Financial institutions have been using novel technologies to help them in complex processes concerning fraud detection. For instance, in March this year, Japan Exchange Regulation (JPX-R) and Tokyo Stock Exchange, Inc. (TSE) announced they would apply AI to market surveillance operations in order to detect misconduct such as market manipulation.

Read this next

Institutional FX

FXSpotStream volumes hit 14-month high in November

FXSpotStream’s trading venue, the aggregator service of LiquidityMatch LLC, reported its operational metrics for November 2023, which moved higher on a monthly basis.

Digital Assets

Circle denies ties with Palestinian groups, TRON founder

Stablecoin issuer Circle has denied allegations that it facilitates funding for terrorist organizations.

Retail FX

CySEC hits operator of Titanedge, TradeEU with €90,000 fine

The Cyprus Securities and Exchange Commission (CySEC) announced that it has imposed a fine of €90,000 on Titanedge Securities Ltd due to shortcomings in their regulatory obligations.

Institutional FX

Cboe FX volumes retreats slightly in November 2023

Cboe’s institutional spot FX platform today announced its trading volume for the month ending November 2023, which took a step back after a strong rebound in October.

Institutional FX

Alpha Group seals Cobase majority acquisition

Foreign exchange service provider Alpha Group International plc (AIM: ALPH) has finalized its acquisition of Financial Transaction Services, operating as Cobase.

Digital Assets

TMNG Tokens Successfully Listed on MEXC Crypto Exchange

TMN Global proudly announces the successful listing of its native TMNG token on the MEXC crypto exchange, effective December 1st, 2023. This strategic partnership marks a significant milestone for TMN Global in the crypto space.

Institutional FX

Marex completes acquisition of TD Cowen’s PB business

London-headquartered commodities broker Marex has completed the acquisition of TD Cowen’s prime brokerage and outsourced trading business, which will be integrated into Marex’s capital market division. This division was established following the acquisition of ED&F Man Capital Markets in 2022.

Digital Assets

Talos introduces decentralized liquidity and onchain settlement with Uniswap and Fireblocks

“At the cornerstone of the DeFi ecosystem, Uniswap has the breadth of assets and depth of liquidity that institutional traders need. And to have this partnership powered by Fireblocks, a digital assets infrastructure provider trusted by some of the most renowned institutions, is very fitting.”

Digital Assets

FINMA-regulated crypto bank SEBA Bank rebrands to AMINA

“As we look forward to 2024, our ambition is to accelerate the growth of our strategic hubs in Switzerland, Hong Kong, and Abu Dhabi, and to continue our global expansion, building on all the successes we have laid down over the past years.”