Definition
Authorized push payment (APP) fraud occurs when a person is deceived into processing payment to an attacker’s account.
The urgency of these payments means that victims cannot recognize that they’re being scammed. After transferring the funds, the attacker can access them instantly, complicating recovery efforts.
Push Payment Fraud Working Mechanism
- Scammers frequently masquerade as trusted entities like bank officials, service providers, or even family members.
- They create a fabricated sense of urgency to pressure victims into swift transfers.
- Convinced by the scammer, the victim approves the immediate payment directly to the scammer’s account.
- Once the funds are transferred, scammers promptly withdraw or transfer them elsewhere.
Examples of Authorized Push Payment Fraud
- Bank alert: You receive a call from someone claiming to be from your bank’s fraud team, advising you to move your funds to a ‘secure’ account due to suspicious activity. Believing it’s your bank, you transfer your money, only to realize later it was a scam.
- Rental scam: You find an apartment rental online at an attractive price and pay a deposit via real-time payment to the ‘landlord’. Later, you discover the listing is fake, and the ‘landlord’ is unreachable.
- Invoice scam: A business can get an invoice from a genuine supplier requesting payment to a changed bank account. They make the payment via real-time transfer, only to find out later that a scammer mimicked the supplier’s invoice.