The banks that WON’T refund fraud victims under new scam rules that take force today
MILLIONS still at risk from fraud as banks such as CO-OP, Clydesdale, Tesco, and Yorkshire Bank WON'T cover customers under new fraud rules that take force today.
Until now, banks had refused to pay out if they believed neither they or the customer was to blame for bank transfer scams, known as "authorised push payment (APP)" fraud.
Around £1million a day - or £674 a minute - is stolen through APP — where customers are tricked into moving money into accounts controlled by criminals.
It's seen people conned out of large amounts of cash and not seen a penny refunded, such as landscape gardener David Hunt who lost nearly £10,000 when scammers pretended to be from HMRC.
And grandmother Jo Wilson, who had her £40,000 life savings stolen by scammers posing as staff from NatWest.
But now 17 major banks and building societies representing over 85 per cent of APPs have signed up to a code, which has been worked on by members of the APP Scams Steering Group, that will reimburse victims of bank transfer fraud.
How to protect yourself from fraudsters
ACTION Fraud recommends taking the following advice to stay safe:
- When making a purchase, be suspicious of any requests to pay by bank transfer or virtual currency instead of safer methods, such as credit card or payment services such as PayPal.
- Listen to your instincts: If something feels wrong then it is usually right to question it. Don’t pay for goods or services unless you know and trust the individual or business.
- Personal information obtained from data breaches is making it increasingly easier for fraudsters to create highly targeted phishing messages and calls - watch out for these.
- You shouldn’t assume the caller is genuine just because they’re able to provide some basic details about you.
- Always be suspicious of unsolicited requests for your personal or financial information.
Under the code, banks will have 15 working days - except in complicated cases - to decide whether a customer is due their money back and they're expected to reimburse victims as soon as possible.
But an issue with the scheme is that there's still no decision on how fraud victims will be reimbursed after 2019.
Stephen Jones, chief executive of UK Finance, says the banking trade body is working with regulators and the Government to establish how victims will be refunded before the end of the year.
Which banks aren't covered?
The code is also only voluntary and not everyone has signed up.
Major banks yet to join include: Clydesdale Bank, Co-op Bank, Monzo, Post Office Bank, Tesco Bank, Triodos Bank, TSB, Virgin Money, and Yorkshire Bank.
That said, Clydesdale Bank, Co-op Bank, Monzo, Post Office Bank, Tesco Bank, Triodos, Virgin Money, and Yorkshire Bank all told The Sun they are planning to join.
The Co-op Bank says it hopes to do so by September, Post Office Bank says it will be next year, while Clydesale, Monzo, Tesco, Virgin and Yorkshire say they're working to update their systems as soon as possible.
Triodos Bank says it's planning to join "in future" but didn't give any timescales on when this would be.
In the meantime, Co-op, Monzo and Tesco Bank say they will refund victims of APP fraud in line with the code.
While Clydesale, Post Office, Triodos, Virgin, and Yorkshire banks say victims will be looked at on a case-by-case basis that bears the spirit of the code in mind.
TSB isn't joining the code because it introduced its own fraud rules on April 15 that sees customers refunded if they've been a victim of fraud - even if it's a bank transfer scam.
In this scenario, victims of fraud will be refunded within 14 days where the case is simple, although it may take longer if the case is complex.
TSB says the only scenarios where it won't payout is where the customer has been complicit in the fraud or where a user has been a victim of the same type of fraud time and time again and hasn't paid heed to warnings.
Which banks are covered?
The banks that have joined the new code are as follows: Bank of Scotland, Barclays, Cahoot, Carter Allen, First Direct, Halifax, HSBC, Intelligent Finance, Lloyds Bank, M&S Bank, Metro Bank, Nationwide, NatWest, Royal Bank of Scotland, Santander, Starling Bank, and Ulster Bank.
Ruth Evans, independent chair of the APP Scams Steering Group, said: “Today marks a watershed in delivering increased protections for consumers from authorised push payment scams.
"For the first time, any victim who is a customer of a signatory firm will be fully refunded, as long as they meet the standards expected of them."
A spokesperson for The Co-op Bank said: “The Co-operative Bank is committed to support customers who are victims of fraud and scams and will be signing up to the voluntary industry code of conduct.
"We are working to do this as soon as possible and customers should be assured that we already align to the code and ensure that we review each case of fraud on an individual basis and work to achieve the best outcomes from our customers.”
A Post Office Bank spokesperson said: “Bank of Ireland, the Post Office’s financial services partner, fully supports the principles of the voluntary code and work is already underway to become a signatory to the code.
"In the meantime, we will continue to support all customers who fall victim to fraud, providing them with the necessary support and guidance and reviewing each case in line with APP best practice standards.”
More on scams
A Tesco Bank spokesperson said: “The safety and security of our customers is an absolute priority and we support co-ordinated industry action to protect customers from APP fraud.
"We intend to sign up to the code and are taking active steps to ensure we can do this as soon as possible.
“In the meantime, our customers continue to benefit from Tesco Bank’s strong fraud protections as we work towards full implementation of the code."
A Triodos Bank UK spokesperson said: "We are continuing our discussions with the industry’s APP voluntary code coordinators about the requirements needed to join, and are assessing the practicalities for implementing the code.
"Our intention is to join in future. All incidents of fraud or suspected fraud are taken very seriously and are looked at on a case-by-case basis, which will incorporate the essence of this new code."
Banks are also working to launch a name-check service by March 31 2020 to stop transfer scams.
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