Banks have sometimes missed opportunities to help "break the spell" of romance scams, according to the City regulator.
The Financial Conduct Authority (FCA) said it had seen examples of banks going to significant lengths to protect those at risk of romance fraud.
But the regulator also uncovered some missed chances to prevent scams.
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City of London Police figures suggest more than £106 million was reported lost to romance fraud in the UK in the 2024/25 financial year, with a 9% annual increase in romance fraud reports. It is estimated that, on average, victims lost £11,222 each.
Victims are tricked into sending money to fraudsters who create false romantic relationships or friendships. More than eight in 10 (85%) cases examined by the FCA started online, particularly through social media and dating websites, suggesting platforms have a critical role to play in preventing fraud and reducing harm, the regulator said.
Losses in confirmed romance fraud cases assessed by the FCA ranged from £100 to £428,249.
In its romance fraud review, the FCA set out measures that banks and other payment firms could take to protect their customers - such as better detection and monitoring systems, staff training, early identification of signs of vulnerability, and compassionate aftercare.
The regulator said firms can have difficulty stepping in because victims may be reluctant to accept they are being defrauded. In nearly half (42%) of the cases the FCA reviewed, victims did not disclose the true reason for making a payment when asked.
A key area of improvement is for firms to ensure their staff are trained to spot red flags and critically probe customer explanations, the regulator said. It added that this was not consistent across all firms.
In 15% of the cases reviewed, customers had previously been victims of fraud while banking with the same firm, highlighting the need for tailored protections and ongoing monitoring, the regulator said.
In a quarter (25%) of cases, victims were coerced into getting funds from various sources, including new loans, borrowing from friends and family or liquidating their personal assets.
The regulator identified cases where victims were left in a financially vulnerable situation, with one entering an individual voluntary arrangement (IVA).
In one case in the FCA's review, someone made 403 payments to a fraudster over the course of a year, resulting in losses of more than £72,000.
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.