UK households are being issued an urgent warning about a sophisticated scam targeting bank cards stored in digital wallets like Apple Pay and Google Pay. Fraudsters are using phishing techniques to steal card details, enabling them to go on high-value spending sprees without the victim's card ever leaving their possession.
How the Sophisticated Scam Works
Experts have detailed a concerning new method where criminals pose as bank officials. Victims receive a phone call from someone claiming to be from their bank, asking if they recognise recent transactions. When the victim denies the purchases, the fake banker says the transactions have been stopped and offers to help by providing a security code.
The critical twist is that the caller is actually a scammer who has already added the victim's card to their own Apple Pay or Google Pay. The notification or text message the customer then receives is a genuine bank alert, asking for approval to add the card to a new device. Danai Antoniou, chief scientist at financial services AI company Gradient Labs, who issued the warning, explains the psychology.
"Victims often describe feeling panicked and pressured during the call, being told their account is under attack, or that their money is at risk," Antoniou says. "In that heightened emotional state, approving a notification feels like the responsible thing to do. The victim believes they're protecting their account, when, in reality, they're handing over the keys."
The Fraudsters' Spending Spree and Laundering Tactics
Once the scammer gains approval, they can immediately use the stolen card details. Antoniou notes that the criminals typically target high-value merchants. "They drain accounts at high-value merchants, such as tech stores and fashion retailers," she adds.
The appeal for the fraudsters is simple: electronics and designer goods can be quickly resold on the secondary market with minimal loss of profit during the money-laundering process. This makes the scam highly lucrative and attractive to organised criminal groups.
How to Protect Yourself from Digital Wallet Fraud
UK Finance, the trade association for the banking industry, has issued clear guidance for consumers to protect themselves. Their advice is crucial for anyone using contactless payment services on their smartphone.
The first line of defence is vigilance. Be extremely wary of unsolicited calls, even if the caller seems to know some of your details. Remember, your real bank or the police will never ask you to transfer money to a 'safe account' or ask for your full PIN, password, or to approve a digital wallet notification.
UK Finance advises: "Set up bank alerts in your app, and check your transactions regularly so you know about any suspicious transactions as soon as possible." Proactive monitoring of your account activity is one of the most effective ways to spot fraud early.
Their final, critical instruction is: "If you think you've fallen for a scam it's important to contact your bank immediately and report it to Action Fraud." Acting quickly can help your bank stop further transactions and begin the process of investigating the crime.
