Payment Diversion Fraud occurs when criminals manipulate a victim into sending money to a bank account under their control instead of the intended recipient. Criminals commonly gain access to email accounts or create convincing impersonation emails to trick victims into changing payment details.

Over the 2025/26 financial year, Report Fraud received 3,657 reports of Payment Diversion Fraud, a 3% increase compared with the previous year. Although overall reported losses have fallen, victims still reported losing more than £101 million.

Detective Superintendent Oliver Little, from the Lead Force Operations Room at the City of London Police, said:

"Payment Diversion Fraud is a highly effective form of fraud because it exploits trust. Criminals impersonate legitimate organisations, suppliers, colleagues and service providers, often using compromised email accounts to make their requests appear genuine."

"The consequences can be devastating. Businesses can suffer significant financial and reputational damage, while individuals can lose life-changing sums of money that they intended for important purchases, services or investments."

"We know criminals are constantly evolving their methods and are increasingly using technology to make their fraud look more convincing. That's why it's vital that any request to change payment details is independently verified before money is transferred."

Analysis by Report Fraud found that invoice fraud remains the most common type of Payment Diversion Fraud, accounting for 813 reports, or 22% of all cases received. In these cases, criminals send amended invoices or impersonate a legitimate payee and request that money is transferred into a different bank account controlled by the offender.

Report Fraud has also identified criminals expanding their activity beyond traditional invoice fraud. Offenders are increasingly targeting online booking and ordering platforms used by hotels, restaurants and other service providers, diverting customer payments away from legitimate businesses.

Emerging reporting has also identified a growing threat involving pension funds. In these cases, criminals gain access to pension accounts and attempt to divert funds for their own financial gain.

While businesses remain a key target, the data shows Payment Diversion Fraud can affect anyone. Individuals accounted for 63% of all reports made during the reporting period, while organisations represented 35% of reports. People aged between 30 and 39 years old were the most frequently reported victim group.

Among businesses, the construction sector recorded the highest number of reports where industry information was available. Smaller organisations may be particularly vulnerable due to fewer resources dedicated to cyber security and payment verification processes.

The assessment also highlights the risks posed by emerging technologies. Criminals are increasingly able to use artificial intelligence to create convincing phishing emails, mimic writing styles and impersonate voices and video calls, making fraudulent communications more difficult to identify.

How to protect yourself from Payment Diversion Fraud

  • Verify: if you receive a request to move money into a new bank account, contact the supplier directly, using established contact details to verify and corroborate the payment request. If you are sending large sums, consider sending a small amount of money first as a test payment and confirm this has been received by the intended recipient before sending the full amount. 

  • Internal processes: establish robust internal processes for handling changes to payment details. For example, only designated employees should be able to make changes to payment arrangements 

  • Sensitive information: invoices, payment mandates, and other documents containing sensitive financial information should be stored securely and only be accessible to those staff that need them to perform their duties. Sensitive documents should be shredded before they are disposed of. 

What to do if you are a victim of Payment Diversion Fraud

  • If you have made a payment: inform your bank as soon as possible, they can help you prevent any further losses. Monitor your bank statements regularly for any unusual activity. 

  • Review: perform a review of your payment processes to ensure all payment requests to a new account are verified and corroborated and existing payments are being made to the correct payee. 

  • Identity theft: if you have shared personal or financial information, and suspect your identity may have been stolen, you can check your credit file quickly and easily online. You should do this every few months anyway, using a reputable service provider and follow up on any unexpected or suspicious results. You can also sign up for Cifas services which can help to protect you against fraud 

  • You could be targeted again: fraudsters sometimes re-establish contact with previous victims claiming that they can help them recover lost money, this is just a secondary scam. Hang up on any callers that claim they can get your money back for you. 

Anyone who believes they have been a victim of cyber crime and fraud should report it to Report Fraud, the national reporting service or by calling 0300 123 2040.

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