Huge change to bank rules DELAYED leaving customers at risk of ‘devastating’ financial losses

FRAUD victims face delays to new rules aimed to force banks and building societies to issue refunds within a five-day period.

Mandatory reimbursement rules will help better reimburse victims of authorised push payment (APP) scams.

APP scams happen when someone is tricked into making a payment, often due to criminals posing as a legitimate organisation such as a bank, HM Revenue and Customs (HMRC) or the police.

Scammers may also pretend to be selling goods or services that do not exist.

Brits who fell victim to APP fraud lost a combined £485million in 2022, according to UK Finance.

Many banks are already signed up to a voluntary reimbursement code, but there have been concerns that this is not always being applied consistently.

TSB has its own scheme, and having seen first-hand the consequences of APP scams, it argues that mandated refunds for all bank customers can’t come soon enough.

In response to this, the Payment Systems Regulator (PSR) announced new rules around Faster Payments – the payment system across which the vast majority of APP fraud currently takes place.

Under the mandatory reimbursement rules, most victims of APP fraud will be reimbursed within five business days and there will also be additional protections for vulnerable customers.

High street banks and building societies as well as smaller payment firms will all need to sign up to the new rules which were originally expected to come into force from April 2, 2024.

However, the PSR is now seeking to delay its implementation to October 7, 2024.

A document published by the PSR on Thursday said: “The response from industry was that an April date was unachievable.

“We have listened to this feedback, and we would like to now invite views on further options and our preferred implementation (go-live) date of October 7, 2024.”

But consumer group Which? said the delay means people who would have been protected “risk facing devastating financial losses on top of the emotional ordeal of being targeted by scammers”.

Rocio Concha, Which? director of policy and advocacy said: “Hundreds of millions of pounds are lost every year to bank transfer fraud, and victims desperately need stronger protections in the form of mandatory reimbursement in all but exceptional cases.

“There must be no backtracking on the PSR’s proposals to create a fairer and more consistent system of APP reimbursement.

“With bank transfer fraud continuing to cause misery for so many consumers, these changes can’t come soon enough.”

How to avoid scams

There are clear red flags to always keep an eye out for when you get a message you’re unsure of.

If you receive a text or email asking for personal details, you can check if it’s real by calling whoever it claims to be from – your bank, for instance, will instantly confirm if it’s fraud and advise what to do.

Any bank, trusted organisation or public bodies like councils or the police would will never ask you to withdraw, transfer or send back money from your account.

If you think you have been a victim of a scam, you should report it as soon as possible.

There is no guarantee you’ll get your money back, but banks will often compensate you if you can show you did not know the money would leave your account.

You can forward scam emails to [email protected] and should also contact your bank and report it to Action Fraud, which will give you a crime reference number.

Check if your bank is signed up to the voluntary APP code, which indicates it has pledged to reimburse customers who have been tricked into sending money to scammers.

If your bank is signed up and refuses to refund you, you can complain and ask it why it is not abiding by the code.

You may be able to report the case to the Financial Ombudsman Service, which could order your bank to compensate you.