Financial services firms are missing opportunities to prevent romance scams, according to the FCA.

In a review of the measures firms are taking to prevent scams, the FCA found examples of banks going to ‘significant lengths’ to protect those at risk of romance fraud, but also uncovered missed opportunities costing victims £106m last year.

One case review by the FCA involved a victim losing over £428,000.

Romance fraud is a growing financial crime, with cases rising by 9% last year, according to the regulator.

It is also hard to prevent as many victims to not accept they are being defrauded. In 42% of the cases reviewed by the regulator, victims did not disclose the true reason for making a payment when asked.

In one case in the FCA’s review, the victim made 403 payments to a fraudster over the course of a year, resulting in losses of over £72,000. The firm’s investigation acknowledged that it had not identified the sustained, out-of-character activity.

Another case involved a victim telling bank staff they intended to send cryptocurrency payments to Iraq, claiming it was the only method accepted by their ‘partner’ in the military.

The FCA called on banks and payment firms to improve their detection and monitoring systems, staff training, early identification of signs of vulnerability, and compassionate aftercare.

Steve Smart, executive director of enforcement and market oversight at the FCA, said: “Romance fraud is a vicious crime. All too often it is the vulnerable that fall victim. The impact – financially and personally – can be devastating. We recognise the challenge banks and payment firms have in combating this complex crime and this review aims to help them stay one step ahead of the criminals.”