Friday 08 May 2026 12:01 am
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Thursday 07 May 2026 3:42 pm
Fraud now accounts for roughly 40 per cent of recorded crime in England
The City of London Corporation is calling on tech firms to help build a new digital identity verification network, designed to crack down on fraud and reduce the growing costs of financial scams.
Under the plans, shared with City AM, consumers would verify their identity once with a trusted provider before reusing those credentials across banks and financial services firms, cutting duplication, speeding up onboarding, and making it harder for bad actors to exploit gaps between institutions.
The City Corporation said the proposed system could unlock almost £5bn in economic benefits over five years by reducing fraud losses and improving digital infrastructure efficiency.
The move comes as banks and regulators intensify pressure on tech platforms over the explosion of online scams fuelled by AI-generated adverts and deepfakes.
Fraud now accounts for roughly 40 per cent of recorded crime in England and Wales, according to government figures, with most cases now cyber-enabled.
The new digital ID system would act as a coordination layer between identity providers and financial institutions, allowing companies to verify identities without repeatedly collecting the same documents from their customers.
Chris Hayward, policy chairman at the City of London Corporation, said fraud was costing banks more than £1bn annually.
“Innovation enables new dangers – but it also solves them too”, he said. “We’re asking companies who can provide this infrastructure to step forward and lead the sector’s fightback against fraud.”
The City is now seeking input from tech firms capable of building and operating the infrastructure, with submissions open until mid-May.
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AI scams drive pressure on tech firms
The initiative lands amid mounting frustration from banks and payment firms over the role of social media and tech companies in enabling online fraud.
Industry groups, including the Payments Association, have repeatedly argued that platforms such as Meta and X profit from scam advertising while banks shoulder most of the financial liability when customers are tricked into sending money to criminals.
Research cited by the payments industry suggests UK consumers now see an average of 185 scam adverts each month online, while fake adverts generated an estimated £3.8bn in social media advertising revenue last year.
Since October 2024, banks and payment providers have been required to reimburse most victims of authorised push payment fraud under tougher UK rules.
The government is also pushing a broader ‘whole system’ response to fraud, bringing together banks, telecoms firms, technology companies and law enforcement agencies.
The City Corporation said the digital verification project would support those efforts by creating a more secure and interoperable framework for identity checks across financial services.
Industry figures said stronger digital identity systems could become increasingly important as AI makes scams more convincing and harder to detect.
Ezechi Britton, chair of the Digital Verification Orchestrator initiative, said fraud currently “thrives on fragmentation”. “This is a clear opportunity for technology firms to help scale UK-wide digital infrastructure that delivers real-world impact,” he added.
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