Trust as a target: The parallels between application and romance fraud

At National Hunter’s annual conference, many experts reflected on the parallels between romance and application fraud. Sharing one of the key takeaways, Dave Rossi, Managing Director at National Hunter, highlights: comparing these mechanisms and learning from them is essential if individuals, lenders and banks are to combat these threats effectively.

Romance scams aren’t only heartbreaking. They are big business for criminals.

Every year in the UK, there are more than 9,400 reports of romance fraud. This equates to a loss of more than £106m or around £11,200 per victim on average. The reports of romance fraud continue to rise at a time when identity fraud as a whole is surging. The common thread tying them together? Trust is exploited and identities are misused.

Romance scams are often seen as personal crimes rather than financial ones. However, behind this emotional narrative sits an uncomfortable truth. The same social engineering techniques used to extract money and information from victims increasingly feed application fraud and identity misuse.

By looking at the tools and tactics used in both of these scams it is quickly made clear that misplaced trust remains fraudsters’ most effective tool. Learning how to combat this effectively is critical.

How criminals turn trust into a weakness

Social engineering tactics are commonly used across several types of fraud, but are arguably most effective in romance scams. The criminals committing romance fraud are experts at identifying the right person to target. These victims are not careless. Warning signs are simply harder to spot, especially when emotions are involved. Additionally, advances in AI-generated images and deepfake videos have made it increasingly difficult to distinguish between what is real and what is fake. These fraudsters rely on two key ingredients: turning trust into a weakness and creating urgency as they move from emotional to financial exploitation.

The parallels with application fraud begin to emerge at this stage. While romance scams exploit emotional trust, application fraud exploits procedural trust. Financial organisations rely on identity data appearing accurate and consistent across applications. In both cases, the deception succeeds when the individual or financial institution accepts the details at face value.

The transition from emotional to financial fraud

This overlap becomes increasingly prominent when romance scams move beyond conversation to emotionally driven and coerced action. At this point, criminals request financial help or access to accounts or identity details. Financial help is often positioned as temporary or practical support. Requests for identity or account details are framed as a necessary step to move the relationship forward.

Criminals’ success rate is increasing rapidly, with TSB’s latest romance fraud report showing that money sent to scammers jumped by 37% in a year, with a 15% increase in case volume. Once a fraudster has your details, they will keep them even after the relationship ends and use them to open new accounts, transfer money and create fraudulent applications.

For banks, this is where risk escalates. Data from the fraud prevention body, Cifas, highlights that identity fraud and false applications reached record levels in the last couple of years, with identity fraud accounting for 59% of all fraud cases.

An individual application with minor inconsistencies is unlikely to raise alarms. Similarly, one victim of a romance scam may seem to be a one-off loss. However, when financial institutions dig deeper and view the crimes collectively, repeated use of the same data points or behaviours can quickly reveal organised activity operating the same crime repeatedly across several banking organisations.

Connecting the dots to uncover the crime

Intelligence cannot be uncovered on an individual, isolated level. Fraud is operating on a massive scale, with operations targeting multiple victims using the same tactics simultaneously. Only by looking at the bigger picture across application fraud and romance scams can financial institutions stop these organised groups.

Shared intelligence is critical. By working collaboratively, lenders and banks can determine whether errors are genuine or coordinated attempts to exploit trust at scale. Criminals are working together and are consistently adapting and improving their tactics so they can continue to successfully coerce their victims. It is essential that banks and lenders work together, too.

Trust is important, but verification matters more

Trust is being exploited. In romance scams, criminals build a connection based on lies. In application fraud, the criminal is attempting to breach procedural trust. However, this doesn’t mean trust should be removed completely. Instead, individuals, lenders and banks need to adopt a “trust but verify” approach. Trust can be reinforced with better signals, earlier intervention and strong collaboration, which stops fraud before it can be escalated.

Romance scams are a reminder that fraud is often persuasive and elusive. Understanding how criminals aim to exploit trust and connecting the dots across the sector will allow financial organisations to uncover fraud more quickly, reducing all kinds of scams, from romance to application.

About the author

Dave Rossi is the Managing Director of National Hunter, where he leads efforts to combat fraud and promote data-driven decision-making across the financial services sector. With a career spanning two countries, Dave has been instrumental in driving operational improvements and forging strategic partnerships that deliver both growth and resilience. He is widely recognized for his commitment to collaboration and his focus on enhancing customer trust through effective fraud prevention.

Article Topics

AI fraud  |  financial crime  |  fraud prevention  |  identity verification  |  National Hunter  |  synthetic identity fraud