• A new reimbursement scheme for victims of bank transfer fraud launches on 28th May -
• Barclays, Santander, Lloyds, HSBC, Nationwide, Metro Bank, RBS have all signed up to the voluntary code, while TSB launched its own scheme
• The code means banks will reimburse victims of ‘push payment scams’
Laura Suter, personal finance analyst at investment platform AJ Bell, comments:
“It’s good news that the UK banking industry has finally been pushed into action to help victims of increasingly sophisticated banking scams. Brits are losing almost £1m a day to these devastating cons* and many have been met by a brick wall when trying to get compensation from banks.
“Victims got back just 20% of the money lost to scammers last year**, highlighting the fact that they bear the bulk of these losses themselves. The new code of conduct will mean customers who are defrauded will be reimbursed by their bank, unless they have been ‘grossly negligent’ or ignored warnings.
“The new code tips the scales back in savers’ favour – the banks in the scheme can no longer dismiss claims to be reimbursed offhand, and already we’ve seen some of these banks ramp up their warnings to customers making transfers. But ultimately the banks still have more to do to stop these scams happening in the first place, particularly as the most vulnerable in society are more likely to be victims.
“This new code will be cold comfort for those who have already been scammed out of their life savings, as the code won’t be retrospective. The industry also needs to come up with a way to fund the reimbursements long-term, as the current funding system is only in place until the end of this year.”
* According to figures from Which?
** Based on UK Finance figures: