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This week on Which? Conversation: 2 August 2021

Here’s what’s happening on Which? Conversation and around which.co.uk for the week of 2 August.

Welcome to August! Hope you’re doing well and had a good weekend?

Last week on Which? Conversation

Thanks again to all of you who joined us for our Q&A with Which? Computing editor Kate Bevan last week! Feel free to check out the comments for discussions about your iPhone battery, Windows 11, laptop cooling fans, and more.

Late last week also featured a crossover between the Which? Money and Which? Investigates podcasts. Lucia and Greg investigate whether your money could be causing climate change. Check it out below, and subscribe wherever you get your podcasts.

What’s in store this week?

We’re looking forward to welcoming Stephen Maunder and Ian Aikman to Which? Conversation to take your questions about property and mortgages. They’ll be live and answering questions in the comments from 2pm on Thursday 5 August, so be sure to drop by and say hello.

We’ll also be looking at how motoring related scams remain a threat, hearing directly from the Food Standards Agency, and announcing next week’s event.

At the polls

We’ve been reading about the changes to the Highway Code which would give cyclists and pedestrians greater priority at junctions and motorways. The Transport Secretary has said that this will “help people keep fit, reduce congestion, and help the environment”. How does this land with you? Would you support these changes? Do you think they’d have a benefit?

Do you agree with the changes to the Highway Code which give cyclists and pedestrians greater priority at junctions and crossings?
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Last week’s polls on ice cream preferences and how many steps one walks in a day are showing strong results for vanilla ice cream and for between 5,000 – 10,000 steps each week, respectively.

Can you help?

Here’s a few conversations from the past week you may want to jump into, or start up in the space below:

  • Are you finding unexpected items in your Ocado order? Community member @alfa is keen to hear from people on their experiences with Ocado. Jump over into our existing conversation and tell us about your experiences.
  • What subscriptions would you be interested in Which? reviewing? In the Ideas Lounge Jonathan’s suggested reviews of razor subscriptions. Give it a vote in the ideas lounge if you’d like to see Which? review it, as this helps us gauge how popular of an idea it is. Any other subscription boxes you’d like us to review? Let us know in the comments below.
  • Another idea from Isy Goodhand – are you finding it difficult to get a mortgage because your house has spray foam insulation? Let us know your experiences in the comments below, and if it’s an idea you’re keen to discuss further, give it a vote in the ideas lounge.

What else is going on for you this week? We’re keen to hear what consumer issues are going on for you – please do share in the comments below!

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Ian Roberts says:
3 August 2021

Sorry but I am not convinced that giving cyclists extra priority at junctions is the answer. Firstly the changes to the Highway Code reflect existing advice and legal requirements that are already in place for motorists. Secondly I believe more education and accountability for cyclists is the answer. I am, at varying times, a pedestrian, a cyclist and a car driver. Yes I do see some appalling driving as well as careless behaviour by pedestrians. Sadly I see far too much very bad cycling with no respect for the rules of the road or other road users. Cycling on pavements that are not designated cycle paths, even when there is a designated cycle path / lane nearby. Cyclists flitting between road and pavement randomly. Cyclists ignoring red traffic lights – yes they apply to you too. I have cycled in London and it can be very dangerous. Sadly I have seen accidents where cyclists have been knocked off (thankfully none involving serious injury) but in every case the accident could have been avoided by the cyclist obeying the Highway Code as it applies to them.

Every injury or death of a cyclist is one too many but sadly there are far too many who don’t take responsibility for their own safety.

Ian — The new guidance in the Highway Code is intended to ensure that cyclists have priority when travelling straight ahead at junctions. I cannot understand any objection to that. I have seen many instances where drivers of cars and other vehicles cut across pedal cyclists who are not intending to turn left into an upcoming side road. I know cyclists do not always indicate when they do wish to turn left, which can be a bit annoying perhaps, but that does not justify putting them at risk of a collision by not allowing them to proceed forward beyond the junction.

The new code introduces a “hierarchy of road users” that puts more responsibility for road safety on the more dangerous modes of transport. Vehicles can make up lost time far more easily than a cyclist can so it seems like a good move to me. It doesn’t give “cyclists extra priority at junctions” but confirms their priority status if they are intending to proceed ahead.

The Highway Code is predicated on road safety so I find it hard to understand objections to the new guidance, but I feel that there is always room for improvement with all classes of driver, so I agree that education to improve road skills is highly desirable. The Highway Code is an important part of driver and rider education so I hope people get the new edition and read it. All road users are accountable for their actions on the roads and for being aware of their responsibilities to others; the faults of others do not excuse a retort along the lines that they don’t deserve to be treated with special consideration — we all need special consideration, all the time.

Phil says:
4 August 2021

We’ve all seen cyclists move up on the left hand side of a vehicle which is already indicating to turn left. It’ll happen more often if they think they have right of way. With a large lorry or bus they could easily find themselves in the driver’s blind spot.

I think the advance boxes for cyclists at many traffic-signalled junctions are helpful but I share your concerns, Phil, although that can happen — and does — without any change in the Code because cyclists and pedestrians already have priority over left-turning traffic if they are crossing, or are about to cross, a side road.

There was a recent case when a haulage driver was convicted of dangerous driving [which led to a fatality] because he had not adjusted the side mirrors properly on the vehicle and could not see the front nearside zone from the driving position.

I would prioritise those who are most vulnerable to a collision. Car and truck drivers are well-protected; cyclists much less so and pedestrians not at all. Whoever might be at fault, careless or irresponsible among pedestrians and cyclists they should be protected from injury or death.

Cyclists are no more protected than pedestrians when it comes to a collision. However, because they ride about on what amounts to a 15 kg knuckle duster, and carry a lot of momentum when travelling at speed, they are much more likely to be a danger to pedestrians (and themselves) than vice versa.

That is the only reason to categorise them below pedestrians in the injury stakes.

Jon has highlighted an idea from Isy Goodhand – are you finding it difficult to get a mortgage because your house has spray foam insulation?

Before panic sets in for those with cavity wall insulation, the problem is – correct me if I am wrong – confined to those that have their roof space insulated with certain types of expanded spray foam. Anyway, there is almost nothing that can be done to remove expanded foam and other forms of insulation from cavity walls, so you are going to have to live with it.

The general principle is to have your cold loft space well ventilated to help prevent condensation forming and causing rot in the roof timbers. Foam prevents proper air circulation and can trap water, either from a leaking roof or where condensation pockets form.

Which? already has an article on spray foam insulation that sets out various technical issues. Perhaps it needs updating to warn of the risk to mortgages:


There was for a while a problem with some wall cavity foam insulation – which released a nasty gas in small quantity for a long time. I forget which, might have been formalin. This caused significant allergy in a percentage of the population.

The situation is not so much better today.

Methylene diphenyl diisocyanate also known as MDI. This off-gasses during installation and may continue to do so for the life of the building, if the foam does not cure properly. Sensitisation to MDI may cause asthma and further exposure can result in severe reactions and repiratory problems.

The property must be unoccupied during application and until the foam is fully cured – at least 48 hours – and well ventilated thereafter.

Any spray dust needs to be vacuumed up and removed with a class H industrial vacuum cleaner. It contains various proportions of the hazardous and hence uncured chemicals which, apart from the inhalation risks, can cause contact dermatitis.

The other component, the polyol blend, may contain amine catalysts, which can trigger allergic histamine attacks in some individuals. Catalysts are chemicals that do not themselves undergo a chemical change, so are there in small quantities for the life of the product, unless volatile.

Read more about the health risks here:


This article talks from a surveyor’s perspective about valuation of properties with spray foam:


Urea-formaldehyde foam was an early form of cavity wall insulation. This could release small amounts of formaldehyde gas into the home, so its use was discontinued. It may still be doing a good job. It’s worth having adequate ventilation because there are various chemicals given off by furnishings and plastics in the home.

Formalin is a solution of formaldehyde in water. It used to widely used to preserve biological specimens, stored in tanks or jars. This releases formaldehyde which causes irritation to eyes and mucous membrane and may be associated with cancer.

I would be wary of having my roof insulated under the tiles because of the risk of rot, which Em has mentioned.

There seems to be an inbuilt assumption that everyone will adopt cycling and walking and leave the car at home. People use their cars because they find it convenient to take people and things from place to place. They may wish to do this because the load is bulky, the passengers are young or elderly, there is a time constraint, or they are not feeling particularly fit and it is raining. The terrain may be difficult and it may be inconvenient to have to change clothes at either end of a journey. Some people may feel vulnerable on a bike or unsteady and nervous in heavy traffic. Winter cycling is also unpleasant. By all means promote cycling as a good idea, but don’t extrapolate that into excuses to make the motorist seem like a pariah and punish him for owning a car.

Those are all good points, Vynor. And despite its virtues, public transport is not always available, convenient, timely or direct enough to substitute for the motor car.

Norwich has park & ride facilities with four buses an hour on four routes through and across the city centre to and from the outskirts [i.e serving eight destinations], but if you want to go out for the evening the service thins down drastically after six o’clock to one an hour and the need to change.

They are limited-stop services so are not much good for local or orbital journeys, but the general bus services also stop running at a useful frequency quite early and the cross-county buses that serve rural areas and other towns are not much use either except on certain days or at specific times. There will have to be much more investment in useful services and the provision of surplus capacity for some time before people will consider the frequency and reliability acceptable and choose to go by bus and I just cannot see that happening. Priming the market ahead of demand is not a characteristic of public policy.

If the continuing restrictions on car access that are a part of current policy prevail, and which could intensify, then it won’t be a case of switching to public transport but of just not going out and city centres will die. This might be a necessary consequence of decarbonisation, but are we ready for that and what will be the social implications? I don’t see non-fossil fuel motoring as the entire solution and more practical thinking has to take place and possibly a radical alteration in everyone’s way of life.

My view is that most forms of transport will remain for many years to come but their proportions will change.

Although fossil fuelled new cars will be banned from sale there will remain a large number of existing vehicles that people will try to keep running, partly because of the cost of changing. But with so many other vehicles requiring diesel – vans, lorries, agricultural for example – I imagine continuing to run a diesel car will be practical for many years

I doubt many more people will choose to walk or cycle than do now. However, I suspect we will see more useful small electric transport than e-scooters and e-bikes for local journeys when, inevitably, fossil power is banned from towns.

Public transport will have to improve to meet the need created by such a ban. I anticipate it will be by both conventional electric buses and smaller versions offering much more route coverage and flexibility.

My point is this will not be an “all or nothing” change but a gradual evolution. Choice will remain.

Just over 100 years ago, the normal mode of local transport was horsepower. I wonder if there is any mileage in reconsidering this as a possible alternative for short distance commercial deliveries in towns?

I guess horses are carbon neutral and fully recyclable, as are their emissions, but are there any problems with other greenhouse gases (methane)? How dangerous are horses compared to cycling or motor vehicles? What are the economics of running a horse fleet?

We get quite enough emissions from horses on the roads near our village. Rumour has it that some of the locals collect them to put on their rhubarb, although I prefer custard.

Cycling is gradually increasing in popularity: https://www.statista.com/statistics/899206/cycling-participation-uk/

Much has been said about the need to tackle the growing problem of obesity and exercise is obviously important. e-bikes provide the opportunity to cycle for those who find cycling a challenge.

I struggle to cycle further than down to the village and back thanks to a leg injury caused by a motorist, many years ago, but I’m still able to walk a few miles, and feel better for it.

Methane makes up 7% of a human fart.

The average fart is 476 – 1491 ml per 24 hours.

Every person farts on average 5-15 times a day.

There were 7.674 billion people on the planet in 2019.

Disclaimer: Information provided by Google

Hay! I was trying to be semi-serious. In Vienna, or was it Bruge, horses have a leather chute attached to their tails. Emissions slide down under the carriage to be carried back to the depot.

Maybe there is a way to capture the methane and use it to aid propulsion. This technology could be known as regenerative breaking.

https://www.historic-uk.com/HistoryUK/HistoryofBritain/Great-Horse-Manure-Crisis-of-1894/ explains that it was not all romantic clip clopping about.

Obesity might best be challenged by eating properly, with exercising being the bonus.

A question we might ask is why we need to travel so much; how much is discretionary and will we not naturally reduce that when the disincentives are there? Do we need to shop so often, go to school every day, ditto the office. I wonder just how much congestion and pollution would be avoided if we were to voluntarily avoid unnecessary journeys.

There are hybrid horses
and, on a smaller scale, battery hens, so nothing new really.

So if we cross a horse and a battery hen, we get an electric horse?

. . . or a huge poached egg!

The new Highway Code will not be in use until later in the year and hopefully by then most road users will be aware of the changes. The results of the public consultation that has informed the revision process are here: https://www.gov.uk/government/consultations/review-of-the-highway-code-to-improve-road-safety-for-cyclists-pedestrians-and-horse-riders/outcome/government-response-to-the-review-of-the-highway-code

How many people know the current highway code? Once you’ve passed your test……… And cyclists are not generally tested on it.

I see it as our responsibility to keep up to date, as we should take responsibility for looking after our health, paying attention to computer security, being aware of how to avoid being scammed, etc.

I failed my driving test because new rules for roundabouts were not in my copy of the Highway Code, purchased in 1967, before I had a provisional licence. The driving examiner pointed out that these rules were displayed on the wall of the test centre. I promptly bought a copy of the new 1968 version, which did include these rules.

It may be so, but I do not believe that to be the reality. However, we should, presumably be responsible for any transgression when we do not keep up to date? Just as we should take responsibility for our actions when scammed?

The two situations are hardly comparable, I believe. There is a difference between hurling a ton or more of metal around at breakneck speeds without bothering to learn how to do it according to the rules, and falling victim to a skilled and cunning crook.

In one case you become deprived of money, while in the other you can deprive families of their sons, daughters and parents.

Taking it a step further, at what point do we punish those who cannot or don’t look after themselves? Do we–for example–deny medical treatment to all smokers, the overweight, those who don’t exercise, those who become injured while attempting DIY tasks or those who drink alcohol? After all, those who consume medical services are among the greatest consumers of taxpayers’ money.

These are just examples of situations where personal action could help the individual protect themselves. A driver who fails to comply with the rules obviously has the potential to seriously injure others.

I doubt that many would support denying anyone medical help, irrespective of the circumstances.

Those actions have been rightly rejected in several Convos.

Those who smoke and drink heavily pay a lot more in taxes than those who don’t so it would not be fair to deny them treatment because they have brought ill health upon themselves. It would be impractical and deeply invidious to withdraw medical treatment from other categories of patient according to some contrived assessment of their personal contribution to their condition. Insurance for serious cases would be unaffordable and if we claim to be a civilised and humane country we can’t just abandon people to their fate.

We have a comprehensive health service which is not conducive to discriminating between the causes of patients’ medical needs – attribution would be a nightmare and the courts would be clogged up with actions of which the cost and impact on the delivery of healthcare would outweigh any perceived benefit from such a policy. Society has to accept collective responsibility for its own general behaviour and its consequences.

Double standards may apply. We provide medical care for those who don’t look after themselves and even those who participate in dangerous activities such as motor racing and rock climbing, fully aware of the risks, yet some would like to deny help to those who have been victims of scams and lost large sums of money.

some would like to deny help to those who have been victims of scams and lost large sums of money.” Who has said they would like that? I, for example, have said nothing about denying help but….. I have said that providing reimbursement should depend upon where the responsibility for the loss of money lies.

Conflating treatment of health issues, however caused, with financial issues, again however caused, is quite wrong. There are no double standards, here at any rate

Wavechange — I think that confirms that attribution is the contentious issue and the standards applied to determining it. Banks have hitherto taken an absolutist line on reimbursement: “if you gave your account numbers to someone you didn’t know, for whatever reason and regardless of the circumstances, and they used that information to transfer money out of your account, you must have authorised the payment, therefore we cannot accept any liability to reimburse you”.

If the bank doesn’t restore their funds, the customer thinks it is acting unfairly; if the banks do routinely refund the losses, the public thinks they are being too easy and opening themselves to organised crime. In between all this is an assessment process which is bound to be inconsistent, is possibly weighted towards favoured customers, and does not apply equally across the industry with some service providers declining to participate.

The ‘simple’ solution is to mandate all banks to accept responsibility in defined circumstances and to set up a central arbitration and appeals unit to adjudicate on borderline cases, but that in itself would struggle to gain universal acceptance and defining the circumstances could be difficult and a long haul. It could also be exploited by commercial interests [the whiplash compensation claims industry is a possible case study for that; the PPI claims story is closer to home but there the banks were clearly unable to defend themselves because their procedures had been deficient].

It is difficult to explore this problem entirely rationally because we just don’t know how many APP fraud claims there are and the scale of them; the average claim could be hundreds of pounds or tens of thousands. It is conceivable that the problem now is nowhere near as bad as it was a few years ago as people have become more aware of payment diversion fraud attempts and the criminals have found easier pickings in other areas.

This topic has been explored regularly by commenters but nowhere have Which? sought a considered contribution from those involved (as far as I remember). So emotive comments often result that, naturally, sympathise with the victim. And adverse comments when a contribution suggests we should take responsibility for our actions. My personal view is that when we take a course of action we are responsible for what we choose to do; if that course proves a poor one we should accept what we have done and not try to offload our responsibility onto someone else unless, of course, they played a part in the poor outcome.

John wrote: “The ‘simple’ solution is to mandate all banks to accept responsibility in defined circumstances and to set up a central arbitration and appeals unit to adjudicate on borderline cases, but that in itself would struggle to gain universal acceptance and defining the circumstances could be difficult and a long haul.”

I agree, provided that the criteria are are generally seen to reasonable, a concept that is frequently mentioned when we are discussing consumer rights. There needs to be an INDEPENDENT appeals system. The sooner that the voluntary code of practice is replaced the better. As Which? has pointed out, this has allowed customers to be treated very differently depending on which bank they use.

Malcolm wrote: “Conflating treatment of health issues, however caused, with financial issues, again however caused, is quite wrong.” I disagree and feel that it is essential that we do makes comparisons. I suggest using ‘comparing’ rather than ‘conflating’ because the latter could suggest deliberate confusion.

It does serve to confuse when apples and pears are compared. Preserving someone’s life by medical care is on quite a different level than preserving someone’s financial state. Failure to do the former can lead to death, which of course is irreversible. Finances can be recovered.

A small solicitors’ company has been brought in front of their governing body for allegedly acting dishonestly in acting for both seller and buyer to convey storage units. The buyer was given to believe that the rental from their purchase would be 50% a year. Some put their pension fund into the purchase. Now, should their banks repay this money?

“Conflating treatment of health issues, however caused, with financial issues, again however caused, is quite wrong. There are no double standards, here at any rate”

My initial thought was to agree with this and hit a thumb-up. However, I refrained when I remembered a programme – within the last year or so – on main stream TV, which identified a couple of folk who had taken their own life having been systematically relieved of their family retirement fund and having been met unsympathetically by their financiers.

I have since decided that, even if the banks had reimbursed, whilst restoring the financial position would obviously have helped, the biggest sensation that tipped these individuals to take the very sad step was one of perceived failure, and I actually doubt the financial restoration would have done much to relieve that – although we all here know that some of these scams are so fiendishly prima facie authentic and devious, there but for the grace of God…

Have a like!

I think you’ve identified the big problem, Roger: being scammed out of significant amounts is very much a heath issue, albeit a mental health issue. It ultimately comes down to our perception of the victim.

There’s a tendency to assume we’d never fall for any sort of scam, and those who do are simply naive, careless, gullible or downright stupid. However, that doesn’t seem to be supported by the statistics.

Around 85% of victims are only scammed once, which suggests a lesson learnt the hard way. However, it’s thought that many scams are never reported, such is the innate shame felt by the victim.

But there’s another, more worrying factor: victims are often people who are trusting. sympathetic or caring. Those same people may find it so hard to come to terms with their decency being abused that they cannot adapt.

It’s a nasty world in some ways, I agree. but the fact that those being scammed are probably the more decenet among us is extremely sad.

We have read about some naive scams, such as the Facebook ads that have encouraged people to order expensive goods at very low prices on Facebook. The amounts involved are typically small and perhaps the best outcome is that those involved learn to be more careful. On the other hand those with expertise usually say that there are some clever scams, and it is important to investigate these cases impartially. It makes no sense that different banks are, according to Which? and other sources, treating customers differently. I would like to see the banks working together so that money can be recovered from receiving banks.

Ian wrote: “Around 85% of victims are only scammed once, which suggests a lesson learnt the hard way. However, it’s thought that many scams are never reported, such is the innate shame felt by the victim.” The first figure is encouraging, and it would be interesting to know if current publicity is helping. No-one has ever told me they have been scammed and it is not something I would ask.

Anyone who makes a credit payment of £100 – £30k the account holder can make a claim against their credit card company under Section 75 of the Consumer Credit Act. The company can require that their customer has made reasonable attempts to recover their money but I presume they would have to reimburse them in event of a scam.

Even Jim Browning has been scammed, see:-https://www.youtube.com/watch?v=YIWV5fSaUB8

I believe that (rather definitively) makes my point. Scamming can happen to anyone. If you haven’t been scammed, perhaps you’re simply lucky. Thus far, at any rate.

As far as I am concerned that point was not an issue. What is the issue, in my view, is the degree of responsibility each party has for any loss in deciding recompense.

I cannot see that anyone has disagreed with that. What might have caused a problem, however, is the linking of stories about those who’ve fallen victim to the crime of fraud and those who feel that any recompense by the banks is using customers’ money to compensate the feckless. It’s certainly the impression that has been given by some in the past.

It is not “any recompense”, but using our money by the banks to recompense those who would or could be judged to have acted irresponsibly, and where the bank has not been negligent, or where the responsibility should be shared.

Are banks negligent because they don’t have systems in place to ensure that they can recover their customers’ money from receiving banks that have provided accounts or card services to scammers?

I don’t know. Possibly not. The cause of the loss begins with the defrauded party; the bank is secondary to many transactions, obeying a customer’s instructions to transfer money. Retrieving some customers’ funds in irresponsible transfers might be seen as a fortunate bonus rather than an obligation on their bank. The customers’ first option to recover their funds would be to deal directly with the receiving bank.

It would be helpful to know just what is necessary to recover money from the receiving bank. I presume one issue should be to demonstrate that the transaction was fraudulent. I don’t know what the mechanism is to persuade a receiving bank that their client was a fraudster. Examples of why a contribution from the banking industry would be useful.

I suspect that banks might not be too keen to divulge what they are doing but perhaps the regulator could provide general information on their website. Prior to the introduction of Confirmation of Payee some customers were losing money transferred to the wrong account, even when no fraud was involved.

Time and time again there is reference to customers being careless or irresponsible but perhaps it’s time to acknowledge that not all is well in the banking industry.

There is more that can be done on both sides, I’m sure. But we must remember that unless a customer responds to an approach this sort of fraud would not happen.

As far as Confirmation of Payee is concerned, losing money in many cases was instigated by the customer’s actions initially, whether by mis-typing or by being misled. A good way of avoiding a mis-transfer was to initially transfer £1 and check it had been correctly received. This has all been discussed at length.

This advice should have been on all banks’ websites for years but is there evidence that the banks worked together in this way to help their customers?

In the past two years or so the banks seem to be putting in a great deal of effort to protect their customers but like Confirmation of Payee it has taken far too long.

This has all been discussed before.

Indeed it has, but perhaps we should focus more on the deficiencies of banks rather than just the irresponsibility of some of their customers.

If the banks would all agree to tighten their security and anti-fraud procedures there would be fewer unhappy customers.

There are signs that banks are making an effort to protect customers accounts, but they could do a lot more by employing more call personnel to answer the phone when customers need help when access to their cash has been denied.

Last Friday it took about 3 hours to get someone to let me know why a larger than average transaction on my debit card had been denied and my card had been blocked. Promised returned calls failed to materialise, and when I finally got through to their fraud dept the phone went dead and I had to start the whole ghastly procedure all over again.

It’s so easy for a customer to become confused when confronted by someone with a strong foreign accent to understand the security questionnaire and to give the wrong information out during security checks, and rather worrying when the person on the other end of the phone has a distinctive Indian accent. When I finally got through it was a gentleman with an Irish accent, who finally managed to sort it all out, but I felt very stressed at the end of it all.

malcolm r said: 6 August 2021
The cause of the loss begins with the defrauded party;

I disagree, and Beryl’s timely post has shown at least one reason why the banks are often, at the very least, partly culpable. But for a fuller list:

1. The banks do not cooperate. I’ve demonstrated that recently, with a detailed post showing their apparent inability to make their recipient ID system function properly.

2. Some eighteen months after the start of the pandemic, banks continue to use that to excuse their often tardy and occasionally ropey service levels.

3. The banks are still making profits which some might consider obscene: HSBC’s half year results reveal adjusted profit before tax was up 109% to $6.4bn.

I continue to regard No. (1) as the main impediment to consumer-friendly secure banking.

Wavechange, I think we should focus on both the customer and the bank.

If, for example, a fraudulent account has been set up by a receiving bank, and that bank has not carried out due diligence, they have a responsibility to return scammed money. But when the customer’s bank has simply done what their customer has told them to do, and what they are obliged to do, that is transfer money to that account, I see no reason to hold them responsible to repay them. They should do whatever they can to help the customer recover their money (and may make a charge for doing so).

I would like, still, to see a contribution from those who can explain just how such recovery can work, what the international banking system mechanisms are, rather than just speculate.

Otherwise, if we feel it necessary to generally refund anyone, without full regard for their parts in any loss, then we need, effectively, an insurance scheme that will cost us all.

We should certainly ensure that the banks and banking system are doing all they can, and improving systems where they can, to spot fraud and help their customers avoid it. A line needs to be drawn beyond which the banks become fully liable when they fail to provide appropriate and feasible protection ; that same line should determine when the customer is fully responsible, and the width of the line should decide how the share should be apportioned when both have been defective in their actions. This is written in principle into the CRM but needs much greater clarity.

Malcolm – If you look back you will see that I have been pushing for cases to be individually examined. That would help achieve a fair outcome. As Which? has pointed out, banks are more generous than others about reimbursing customers so it is evident that a standard system should be imposed and the regulator made responsible to ensure that this is working. Would you agree?

As you say, more clarity is needed. I do not suggest that banks refund everyone and never have done.

Receiving banks can apply due diligence when providing their customers with accounts and card services but I believe that they have an ongoing liability. An analogy would be our personal responsibility to check our cars remain fit to be on the road at at all times, rather than drive around with a worn tyre or faulty lamp, or ignore a warning light indicating a safety problem.

It is, of course, our responsibility to look after our cars, and we should do the same with our finances. Just as the banks systems should be as robust as is feasible to minimise fraudulent transactions. I would simply like to see both sides of this properly explored and reported but that rarely features in Which? Convos. While it is natural we, and they, should be on the side of the consumer that should not prevent a properly balanced and reasoned approach.

I have seen many examples of what, at first reading, are one sided explanations of how someone was scammed (a natural response when we feel embarrassed or aggrieved) and examples of where we might say that the scam should have been seen for what it was, particularly when it looks too good to be true. As for transferring large sums of money without being very careful to ensure they were genuine and going to the right person it is, of course, easy to sit back and say I would never have done that. But then unless faced with a similar situation, who knows. But the point I make is, why should we (some) expect our bank to make good our failure if they have played no negligent part in it? I want to see fairness to both sides, and I don’t want to support a view that the bank should pay out my money by default – and that of other account holders, many of whom may be struggling financially.

A reasoned and informed examination of this whole issue seems to be lacking.

Ian has expressed concerns about banks and Beryl has provided a recent example. Here is another:

I needed to make a payment to friends and when I asked for details the account name was given in the form XXXXXX WM & EL That did not help because I was asked to enter the first name and last name for the account. WM stands for William Michael, but he has always referred to himself as Michael. I was able to make a payment to William XXXXXX. He subsequently gave me a partial refund and that came from the XXXXXX WM & EL, the account name he had given. I have heard of a various other problems with confirmation of payee, involving various banks. I’m very glad that the system is in place but problems need to be resolved.

The initial problem, which causes all the difficulty, is that someone or some organisation has set up a bank account with the specific intention of using it to defraud others. Their presence on the scene, and interaction with the victims, is why people are scammed. If this was not happening, banking would be smooth and mostly stress free. Once the scammer is free to operate, it is only a matter of time before a victim is found and someone loses money. Then, of course there is the debate about whether this was foolish or careless and, following that, whether the victim should be reimbursed. At that point it is either the victim or the bank that loses out and the scammer is off and away and untraceable. That’s the chain of events. It can be broken by identifying fraudulent accounts, or by the bank policing the transactions more carefully. It doesn’t seem to be broken by catching the scammers, though there are a few successes here.
In this technological age, there must be a set of algorithms that can detect likely scams. By their nature they follow certain patterns and, though more invasive, algorithms can also point towards likely victims. If insurance companies can use them, so can the banks. Here, then, is a record of possible customers who are more vulnerable, even though they might never be defrauded and the bank is one step ahead of the risk. We will never know what goes on behind the scene at bank headquarters, but the evidence suggests that they could do more than they are. The evidence would also suggest that the rate of scamming was falling, if the banks did get a grip on this financial epidemic. They are the ones at the centre of things, moving our money around, and it is this process that is being misused by the scammers.

” 3. The banks are still making profits which some might consider obscene: HSBC’s half year results reveal adjusted profit before tax was up 109% to $6.4 bn

Some may not regard the companies they support as making obscene profits – this one looks like around 9 times HSBC.
For the quarter, Apple posted revenue of $89.6 billion and net quarterly profit of $23.6 billion,

Vynor wrote: “In this technological age, there must be a set of algorithms that can detect likely scams. By their nature they follow certain patterns and, though more invasive, algorithms can also point towards likely victims. If insurance companies can use them, so can the banks.”

I hope so. Beryl has said that a recent larger than usual payment was not made and her card blocked for several hours and communication failed, resulting in stress. One solution would be for the bank to leave a message to contact the bank urgently. Another would be for the customer to contact the bank in advance to say that a large payment was forthcoming.

I agree that the banks could do more to help their customers and at least we have seen progress in the past couple of years. My bank has reduced the maximum payment I can make by online/mobile banking, though I can change this limit if I wish to.

We should expect our banks to pay more attention to all new accounts by increasing their security systems.

All transactions now take place electronically, almost instantaneously from your bank to the receiving bank first, who then credits the payees account. There is no pot of money sitting somewhere with your name in it. If there was, scammers would be less likely to gain access to it. All very elementary, but here’s the rub.

You have lent that money to the bank. They owe it to you. It becomes their liability, That’s why we say our accounts are in credit. Similarly, if you are overdrawn and owe money to the bank, that becomes your liability and their asset. In the latter case, the bank will come down very heavily on you with disproportionate interest rates for not obeying the rules laid down by the banks.

It’s a different scenario in the first case when you have lent your money to the bank and it has now become their liability to ensure your money is not going to be electronically transferred into a fraudsters account via the receiving bank. You have no legal right to reimbursement, and your bank, whose liability it is to take care of the money you have lent to them, retains the power to decide whether they will compensate you for the loss incurred through their inadequate security systems

Its a bit one sided whichever way you look at it, and always favours the banks on both occasions.

There is a limit on my credit card for reasons which obviously favour the bank re reimbursement, but not on my debit card. To be fair, the bank security system was working in my favour. My particular gripe was the length of time the bank kept me on hold before I was transferred first to a member of staff who proceeded to ask the usual security questions, and then another long hold before being transferred to the fraud dept and someone with a foreign accent who I couldn’t understand a word she was saying, and was cut off. After waiting another hour for a promised call that never came, I just gave up. I waited another hour before trying again. The whole process took about 3 hours.

It’s not good enough. Even before coronavirus arrived I had become accustomed to automated messages about this being a busy time and encouraging me to use the website. Here I am not referring to calls to my bank because it’s a long time since I have called it.

The bank transfers your money because you instruct them to. We need to understand whether or not there is the possibility of banks automatically detecting scams and informing their customers acvordingly. Unless that is feasible I think putting all responsibility onto the banks is unfair and unrealistic.

The banks have a liability to transfer your money into a genuine account. Get rid of all the fraudsters accounts through investigative financial screening,,,,,,,problem solved.

If banks refuse to implement the appropriate measures to safeguard customers financial assets, then legislation enforcement is the obvious and only way forward. It is tantamount to theft by default.

Your bank has a liability not to transfer money to an account that they know to be fraudulent. But, unless it is reported, how does your bank know whether or not an account at a receiving bank is genuine? That is the responsibility of the receiving bank. How easy is it to determine whether a bank account is going to be used fraudulently? Who has such insight?

I remain of the view that the receiving bank should be responsible for retrieving and returning funds fraudulently obtained but if they are beyond our jurisdiction that might prove difficult. Maybe we could list those banks where excessive fraudulent transfers have been taken and warn customers the dangers of sending money to accounts held there.

But why should he sending bank be penalised if they have no way of knowing an account is being used fraudulently? That might satisfy those seeking “compensation” but I do not think it is fair.

But might it not force banks into being just a little more proactive in terms of checking accounts?

Try contacting government agencies. Assuming you have an inclusive call package, just leave your phone on loudspeaker and go and make your dinner. The delays in answering calls seem to be permanent ( not just “at the moment”) so if they are interested in responding they simply need to employ more call handlers. As phoning is often the only way to make contact for a meaningful discussion it is perhaps something that they should get around to addressing? Let’s hope they don’t replace with a Chat line.

Sensible companies tell you where you are in the queue, how long it might take for “an assistant to become available” and to offer you a call back instead of hanging on.

It is the receiving banks that is responsible, not the sending bank. Why should the sending bank be held responsible for making recompense when it seemingly has no relationship to the receiver? But this is why I would like knowledgeable contributions so we work from facts.

We need banks to work together so that money can be refunded in the case of fraud.

If we employ a kitchen fitter, for example, and they sub-contract part of the work to another contractor, the kitchen fitter is expected to refund their customer. Hopefully they can recover the money from the sub-contractor but the customer should not lose out.

Indeed. I suspect discussing which bank is culpable is futile; it is the banking industry as a whole that needs to get its house in order.

malcolm r says: Today 11:15
Some may not regard the companies they support as making obscene profits – this one looks like around 9 times HSBC. For the quarter, Apple posted revenue of $89.6 billion and net quarterly profit of $23.6 billion,

Not sure what that has to do with banks, but on the extremely rare occasion when I’ve had cause to contact Apple, their service has been utterly impeccable, extending to a free gift of an iPod one time when they took slightly longer than they ought when changing a battery in a very old iPod.

Believe me, if the banks were one fiftieth as good as Apple I wouldn’t have a concern. But then, they’d ensure customers weren’t being being defrauded.

Banks obey a customer’s instructions to transfer money. They do not subcontract. I agree in an ideal world banks should be able to identify fraud before it is perpetrated on their customer and advise them not to make the transaction. How?

Banks? I am very happy with my bank’s performance. Exactly how are all banks supposed to identify fraudsters?

We need to be careful of over-expectation with our relationship with our banks — not because we shouldn’t be entitled to better, but because the present structure doesn’t allow it and the fundament changes to enable it are unlikely to happen in the foreseeable future. Beryl said, when you have lent your money to the bank, “it has . . . become their liability to ensure your money is not going to be electronically transferred into a fraudsters account via the receiving bank https://conversation.which.co.uk/community/news/this-week-2-august-2021/#comment-1633922

I don’t think there is anything in the terms and conditions of your service agreement with your bank that states or implies such a liability. Apart from anything else, it would be completely impractical: the money could be destined to any bank anywhere in the world. If there were such a liability the system would break down and the transfer of money would grind to a halt outside of a select number of approved accounts where reciprocal agreements had been entered into customer by customer, account by account.

I question the use of the word “lent” also in this context. Banks offer their customers a deposit and payment service. They keep your money safe and accept in-payments and make outgoing payments in accordance with your instructions. That is all. They will give it all back to you on request provided you haven’t instructed them to pay some or all of it to someone else. I don’t think there are any circumstances where a customer’s funds are on loan to their bank — even savings accounts are not loans.

In order to keep down the cost of their services to their customers, banks are entitled — within their terms and conditions — to make use of the money we leave with them in order to advance funds to other customers or, in aggregation, to trade on the money markets. Even if banks make a lot of money from their management of such money, they are not obliged to give us something while they have it. So long as they act prudently, and maintain a sound reserve position, that seems to be the banks’ only obligation towards us; their use of our money avoids the need to make service charges for their basic deposit and payment service but it is not an accountable benefit nor permanent. Unfortunately, I don’t expect the fiduciary duty of the banks to stretch any further than doing us no harm rather than actually doing us any good.

Beryl went on to say that “you have no legal right to reimbursement, and your bank, whose liability it is to take care of the money you have lent to them, retains the power to decide whether they will compensate you for the loss incurred through their inadequate security systems“. Again that assumes your bank has such a liability, which, in my view it does not. We might wish that it did, but it doesn’t. No bank can be responsible for the security system of a different bank. Your bank can properly be held to account, and has a duty of care to you, only if it is negligent or if it is also the receiving bank in the particular instance.

I agree with Beryl that our relationship with our banks is one-sided and their terms of business are ‘take-it-or-leave-it’ — largely because there is virtually no alternative. It is fairly clear there is a breach of trust between the public so the banks need to review, collectively, how they repair that without having to be compelled to by the Regulator.

I think a form of independent adjudication process to deal with discretionary reimbursements is needed, although Which? has neither suggested it nor given any support to the idea.

I’m not sure how much of a breach of trust exists. I suspect the vast majority of us have no problem with our banks. As for take it or leave it, there are enough banks around to give a choice so if you don’t like a particular bank you can leave it quite simply it seems. Although I have no first hand experience of that because the bank I have bern with for many years has been perfectly satisfactory.

Because the money is transferred from the payers bank to the payees bank first before it is transferred to the payees account, which should have been screened if it is a new account. It’s a joint electronically operated practice between all banks they all need to sign up to for the system to work, but it won’t work unless they all agree to it.

If the few remaining non compliant banks continue to refuse to sign up, then enforcement is the only remaining option left. It’s the only way to break the banking deadlock and protect their customers money from disappearing into cyber space.

Maybe you enjoy premier status?

That is precisely it Malcolm. Banks should know that their accounts are being used fraudulently, everyone else does. That means that banks should have strategies to look for these fraudulent accounts – unusual addresses, addresses that are being cloned, profiles that fit a possible temporary account. Maybe all new accounts should be under suspicion for their first year of operation. Scams are wide spread and payments into an account might reflect the unusual spread of territory. Quick withdrawals after a payment in might also trigger suspicion. I’m not a detective and my naïve comments above may be somewhat facile, but the point I am making is that one way or another, banks or an associated dedicated service could police the system proactively rather than having to consider reimbursing victims after the scammer has left the scene. It always seems that the criminals are one step ahead and that should change.

Malcolm — Several of the Which? Conversations on aspects of banking have shown that there is a widespread contempt for banks and that they are held in general despicion by many customers for their standards of customer service, closure of branches, withdrawal of ATM’s, handling of overdrafts, and so on. These might be irrational reactions to personal situations, and they might predominantly affect a particular customer segment, but the fact is that for the vast majority it is necessary to have a bank or building current account in order to function today, and that many customers are not convinced that the banks are working hard enough to justify their obligatory trust and to always protect their interests.

As you say, there is a wide range of banks available [except in many small towns these days] and switching has been made easier, but while it is possible to escape from your bank it is virtually impossible to escape from the industry-wide principles of the banking contract and standardised terms and conditions that I outlined; I doubt if any bank provides an undertaking of liability of the kind Beryl believes exists or feels is the cornerstone of the customer relationship.

In view of Beryl’s recent experience, I would guess she has lost some trust in her bank.

I have had a very long relationship with my banking services provider and it also has been perfectly satisfactory. There was an unfortunate episode a few years ago when dealing with them in an executor capacity but it was resolved amicably and fulsomely once reported. However, conversations with friends indicate that my satisfactory experiences might not be typical and that many would like to be treated more competently and more respectfully — and truly as a ‘valued customer’ – as they assert was the norm until the 1970’s.

Generally I see these Convos framed at attracting adverse comments rather than supportive ones. So i do not place too much weight on them. The Which? campaign on ATMs, and access to cash generally, has been blinkered and, on some occasions, misleading.
We hear examples of poor behaviour, but these do not prove anything unless placed in perspective.

Vynor, exactly why on something this serious I have asked for contributions from tbose involved so we understand just what banks can do to identify fraudulent transactions. As far as I can see we are just given one side, and I do not think this is helpful to understanding or appreciating what might be the problems and solutions.
Maybe all the banks are colluding to avoid dealing properly with fraud but I doubt it. It seems hardly in their interests if they have to make substantial compensation payments. Maybe they are protecting overseas banks that are known to host fraudsters – but why should they?
It has been said that students sell their accounts to fraudsters. I don’t know what evidence exists to support this as a major problem but if that is the case how is a bank supposed to know that until frauds are perpetrated.

Should a UK bank or banks be colluding to avoid deaing properly with fraud then I will be the first to codemn their inaction. But I also will criticise customers who behave irresponsibly.

I posted a fraud probably committed with the assistance of solicitors where clients were helped to purchase storage units with the promise of a 50% annual return and asked whether banks should refund the “victims” but, unsurprisingly perhaps, no response.

But this topic seems to me to have been rather thrashed to death and, until more substantial information is provided we just seem to be going over the same old ground with the same positions repeated.

John wrote: “We need to be careful of over-expectation with our relationship with our banks — not because we shouldn’t be entitled to better, but because the present structure doesn’t allow it and the fundament changes to enable it are unlikely to happen in the foreseeable future.”

I would like to be more optimistic, John. I have been very happy with my bank but if I am scammed, despite taking care, I want to be reassured that my money will be recovered. I expect that we all do.

Banks customers’ can help to protect themselves but if the growing problem with scams is to be dealt with, the banks can do a great deal more than us. It is vital that the industry works together and if necessary buys-in the necessary expertise to move forward.

What would be helpful would be to explain just what the banks – or the overall banking system if it has adequate coverage – should do, can do, is feasible to do and what experience is needed that is not so far employed.

Of course if we are scammed we would hope to get our money back. But if the banks have played no negligent parts in executing an instruction by the customer to transfer money to an account they do not know is fraudulent, why should the bank be expected to return the money you have lost?

The impression given is that online banking fraud is a huge and widespread problem, suffered by many people, and the system is thus unsafe. From information I have seen there are at least 2.5 billion online transactions a year amounting to nearly 2 trillion pounds. From what I see about 0.00016 of that value is fraudulent, part no doubt with some bank negligence, part with customer negligence. That will be a significant loss to some involved, it needs minimising but does not indicate a wholesale failure of bank security to me.

Malcolm – I acknowledge the point you make about the tendentious nature of Which? Conversation. I sort of factored that into my personal assessment of the public mood because there are other sources such as the mainstream media, the business press, and the opinions of friends and colleagues.

I don’t think the banking industry has recovered from the bad odour in which it was held in the wake of the crash in 2008 and the fact that the government had to mount a rescue exercise which was ultimately loss-making despite high hopes. Whereas that mainly concerned the non-retail side it spilled over into personal banking and certain top executives and their behaviours were the subject of national condemnation which tarred the entire sector.

Maybe, as Wavechange suggests, there is reason for optimism that the fundamental changes required in the structure of the industry will be introduced in the next few months [which to me is the “foreseeable future”].

You are correct, Malcolm, that none of the public know the full picture, and, to a certain extent speculation is just that. It is also true that “the other side” of the picture will always be hidden because security issues are not discussed -and nor should they be. The only evidence we have to go on is published by the media, and they reveal that scammers and fraudsters are making a good living on what they do. That being the case the public are indignant and feel helpless except when taking their own precautions.
The media will report the situation in general terms but it, and the rest of us simply do not know what the banks and finance industries and fraud police are doing in the background. Collateral evidence suggests that they could do more. The whole reason this is such a huge problem is because it seems insoluble. So to return to the beginning, you are correct and I, among many, have been going round in circles! It’s one way of expressing discontent, but probably an ineffective one, since no one behind the scenes reads our frustrated comments and Which? is probably as much in the dark as we are.

malcolm r says: 7 August 2021

Generally I see these Convos framed at attracting adverse comments rather than supportive ones. So i do not place too much weight on them.

I, too, tend to ignore those comments I don’t like.

Maybe all the banks are colluding to avoid dealing properly with fraud but I doubt it.

I suspect the real problem is that the banks are not colluding or cooperating. I fully expect banks to collude; that is acceptable providing such collusion is in the interests of their customers.

I also will criticise customers who behave irresponsibly.

Indeed; wouldn’t we all? But I will ask a question: what do you, personally, define as ‘irresponsible behaviour’? What examples do you have?

This topic seems to me to have been rather thrashed to death

I suspect that’s because some continue to post supporting the banks and condemning the victims of crime. Surely that has to be questioned?

if the banks have played no negligent parts in executing an instruction by the customer to transfer money to an account they do not know is fraudulent, why should the bank be expected to return the money you have lost?

If someone steals my credit card and goes on a binge, then the bank will reimburse me. How does that crime differ from a cleverly constructed scam?

From what I see about 0.00016 of that value is fraudulent

So barely a drop in the ocean in terms of their overall profits? I wonder, then, why banks generally don’t demonstrate a more compassionate approach to victims of financial crimes?

No one doubts that criminal behaviour is to be condemned, or that victims must do more to exercise caution, perhaps, although the attitude of some towards victims seems more in keeping with the outmoded police reactions to allegations of rape in the early ‘70s, where the first reaction was to blame the victim.

But some extremely easy solutions have been proposed, such as imposing mandatory waiting periods for proposed transfers to new accounts, a solution rejected by the banks because it could hurt their business model.

I had reason a couple of weeks ago to make some extremely large transfers. Because their own systems had not been properly sorted, the account destination wasn’t recognised but the bank then halted the proposed transfers, asking numerous questions and warning me in detail about the possibility of scams which employ similar techniques.

I pressed on and overrode the warnings, but both good and bad epitomised the process. The good: numerous warnings and hurdles to leap. The bad: their own systems were not properly prepared.

No matter how we look at this, its very clear the banks are simply not doing enough for their customers.

”I, too, tend to ignore those comments I don’t like.”. Distorting the intent of a comment in this way is a shame. I think some will understand I was looking to see a balanced approach to the issue by Which?
I won’t comment on the rest.

No distortion intended, Malcolm. I was, in fact, agreeing with you. But it’s disappointing that you feel unable to comment on the remainder.

This is particularity pertinent:

I also will criticise customers who behave irresponsibly.

Indeed; wouldn’t we all? But I will ask a question: what do you, personally, define as ‘irresponsible behaviour’? What examples do you have?

I suspect that’s a key part to this entire debate.

You can speculate your views pertaining to banks and agree, or disagree, according your own personal relationship with your own bank, but realistically banking is big business and big business exists to make a profit, and the end user, the likes of you and me are the unfortunate victims when a business goes bust, as we witnessed during the 2007/8 banking crash leaving the taxpayer to pick up the pieces.

This latest debacle concerning fraudulent bank transactions is unfortunately, not an Alice in Wonderland scenario as portrayed by some commenters here on Convo, but more a Grimms Fairy Tale.

To clarify the bank transfer position, let’s examine it from a deeper and more realistic perspective:

Mary has an account with Barclays and needs to transfer the sum of £10 from her account to her friend Charlie. Mary has lent the money in her account to Barclays for safekeeping and Barclays have a liability (are now indebted to Mary) and owe her. If Charlie also banks with Barclays, the transfer is straightforward and uncomplicated.

However, if Charlie banks with a different bank say HSBC, it gets more interesting. Barclays have an account with HSBC who have a liability and are indebted to Barclays to transfer Mary’s £10 into Charlies account and so now, Barclays, like Mary, have become the lender to HSBC who owe Barclays, and have a liability (are now indebted to them) to transfer £10 into Charlie’s account with them.

Imagine if that £10 was £10k or £1m or more, as with commercial banking transactions, or if the recipient happens to be a fraudster with several accounts trading in different names with different banks. This is illustrates the extent of the problem and the opportunities open to fraudsters in the banking sphere, and also the reason why the cooperation of all banks is required, and is necessary in order to flush out a growing scourge that threatens and destroys the trust of the majority of its customers.

Rather than continually speculate I’d like to see informed contributions as to how the banking system can be improved to minimise fraudulent transactions. One fundamental question seems to me how you can predict that someone who opens an account will use it to commit fraud.

In the meantime I would still like to see an analysis of the banks whose account holders commit most frauds. If that showed up clear offenders then they should be ones we are advised to avoid transferring money to.

I do not believe the majority of customers have had the trust in banks destroyed. But I may be in a minority of one.

It helps if you can refrain from quoting individual names or individual comments and focus on the comments of ‘others’ or ‘some others’ when confronting sensitive issues in debates. My comments and name are frequently used as a means to intensify and inflame a delicate situation in order to make and strengthen ones own point of view, but that does not prevent me from responding when I disagree.

The ego dislikes being challenged and can often overrule all ones sensible thinking when engaging in an important and serious debate, which can then cause it to lose all its credibility and purpose.

Some of the issues on Convo. can be challenging and problematic, but ignoring another’s comment when it suits never solves any problems, and only adds to the frustration and irritation of other contributors taking part in the debate.

Malcolm, there are always exceptions to every rule, and your assiduity and diligence have served you well, but nevertheless we are dealing with people who for whatever reason akin to themselves have unwittingly parted with their life’s savings, causing them and their loved ones a great deal of mental distress and anxiety.

Looking at the situation objectively, no one is effortlessly and easily going to part with their own hard earned cash to a criminal unless that criminal has been well briefed and coached into the art of doing so.

My only response, Malcolm, was the one I made before. Insurance companies use a sophisticated and well embedded system of risk assessment to work out what to charge their customers. Amazon et al use a similar system to find out what their customers are up to and how to make them shop more. These systems process data about millions of the public in ways I continue to find mind boggling, but they seem to work. With such technology on hand, couldn’t the banks do the same?

Beryl, (I reference you simply because another comment separates ours). I do not disagree with your last paragraph, but that is not the point I have repeatedly made. And that is the seeming obligation some place on the banks, that were instructed to transfer the money, to repay their customer if the banks had no way of knowing the money was going to a criminal. Just because the customer was duped by a criminal does not, in my view, make the bank responsible.

Vynor, exactly the sort of information that would be useful in this debate. I am not sure what statistics would predict the criminal use of bank accounts but this is precisely why I would like to see those with expertise answering these sort of questions.

But prompted by your comment about insurance perhaps, as has been raised before, insurance could be offered that covers being defrauded and scammed. Much as you insure other possessions against theft. However, we must expect the insurers to assess each case on its merits and we may not always like the outcome. It would provide an independent view and a fund from premiums.

Malcolm, the banks responsibility is to safeguard the money lent or entrusted to them by their customers. If the banks are unwilling or unable to carry out the measures available to them to protect the money loaned to them, they need to seriously consider whether they are still deserving of their customers trust.

The bank does safeguard your money. If they are robbed (never seems to happen these days) your money will not be lost. If the bank goes broke your money is protected ( up to £85 000). Your online contract with your bank requires them to move money to another account when you so instruct. If you mistakenly send it to a fraudster, and the bank have no way of knowing that, the responsibility is yours, it seems to me, even though the scam probably is very convincing.

But we keep repeating the same points. I’d like to see a conversation develp beyong “smething must be done” and identify “what can be done”.

Meantime we could also look at how any compensation could be assessed in a fair way – fair to all involved. It is, after all, our money that is being dispensed. The Contingent Reimbursement Model includes this.

Your money is protected at the expense of the taxpayer, some having been victims of bank fraud.

That is a fair point, Beryl, [about banks considering whether they still deserve their customers’ trust], and I have suggested that some bank customers already have a lower level of trust in their bank than they have in other companies they deal with. But it doesn’t get away from the fact that, if a bank has not contributed to the loss, it is not fair that it should be held liable to reimburse the account-holder whose account suffered the loss — I step back from saying the account-holder “who lost it” but that is not an unreasonable explanation of the true position.

I cannot see what these measures are that you think are available to banks to enable them to look after money that they have been instructed to pay to someone else. So far as I know, the banks are not in a position to know the bona fides of the payment destination given in the instruction unless it is another customer of the same bank [and even then I don’t think there can be any check because they must surely assume that every one of their customers is honest and they would not knowingly to continue providing banking services to a dishonest customer]. The paying bank can only go as far as checking — via the inter-bank protocol that has been agreed among the main banks — that the name of the account holder tallies with the name provided in the instruction it has received and that the destination account details also correspond with those of the nominated account.

As I have said before, banks do diligently look after people’s money and will return it on demand so long as they have not been instructed to transfer it to somebody else. The notion that the banks can somehow look behind the instruction and investigate it is unsustainable in the context of a bank’s duty of confidentiality as it is currently understood, but I suppose, for a fee and for a period of time while the exercise is conscientiously undertaken, banks could be mandated by the Payment Services Regulator to make enquiries of the SFO and related agencies, do a DSB check [Disclosure & Barring Service check, formerly a Criminal Records Bureau check], and search other records and data held within the banking industry to see if there was any likelihood of criminal activity. But all that could still fail to ring an alarm bell, and who would be liable then? It would be a case of not knowing what you don’t know.

Another possible approach is for the bank receiving an instruction from a customer to transfer money to a new payee not to act on it until the bank has had a satisfactory response to a communication to the customer requesting him or her to confirm that it was indeed they who issued the instruction and to verify that the destination account is the intended one. There would be a concern with that process that it would generate more of the “if this was not you . . . ” type of scam that has been growing lately.

When I notified various organisations of my change of address a few years ago I routinely received a letter by return stating that they had received a change of address instruction and telling me to ignore the letter if the instruction was authentic but to inform the organisation immediately if it was not genuine. This is a well-rehearsed fraud prevention measure which could be employed in respect of on-line money transfers either in every case or on a specified basis but it would delay payments, require a manual intervention in what is now an automated process running into billions of instructions every year, and would probably drive us all back to our cheque books which would increase the cost of payment services.

As Malcolm has said, we don’t know the scale or value of this problem and it might be infinitesimally small in the overall scheme of things. Ian suggested that if that were the case it would not harm the banks to concede reimbursement without further ado. But therein lies another trap: that criminals could exploit the process by setting up all manner of false transfers across a number of names and accounts within their fraternity in order to milk the banks dry.

On balance, I don’t think there is an entirely equitable solution to this problem without an indemnity process or a form of insurance cover being available to bank customers who want this sort of protection against the criminal misappropriation of money from their account. After all, it is a form of burglary: someone tricks you, breaks into your account, and plunders your funds. Unfortunately, in this particular crime, the victim has unwittingly given them the key.

The electronic banking systems are near enough perfect, it is the human element that lets everything down. Businesses would be cross if their transactions always came with an “are you sure?” before payment was made and some individuals also need that instant transfer to complete a quick transaction before circumstances change. Might it be possible to change the bank account so that everyone has to set up a payment instruction for each regular outgoing or ingoing transfer? Once set up, money can pass safely across without delay. Any unusual transaction is then automatically examined. At the same time every payee or payer is noted and the bank knows who they are and where they live. Another amateur suggestion to add to the melting pot!

”What is the Financial Services Compensation Scheme (FSCS)?
FSCS can pay compensation to customers of authorised financial services firms when they fail. Set up by parliament and funded by the financial services industry, FSCS is a completely independent and free service. This means FSCS can pay back any money you hold with a failed bank or building society, up to its compensation limit of £85,000 per person.

As far as I know the fund is provided by a levy on financial institutions. I don’t know when it was last used

The Guardian
“The amount of money stolen by criminals through bank transfer scams has risen by 40% in a year and is running at more than £1m a day, according to official UK data.

Scammers stole £616m from UK bank customers during the first six months of 2019, according to banking body UK Finance. Of this total, £207.5m was lost to scams in which people were duped into authorising a payment to an account controlled by a criminal. This was up 40% on the £148.2m figure for the same period in 2018”

“APP scams: 2019 – 36% of scams. If you are a victim of authorised push payment fraud it can be difficult to get a refund because banks are legally required to follow your instructions. However, banks must take steps to protect customers from financial harm.

We have developed a step-by-step guide on what to do if you’re a victim of authorised push payment fraud.

Additional protection is in place for customers of banks signed up to a new voluntary code for APP scams, which provides a reimbursement fund for blameless victims.

Which? has some early concerns about the way this code is being interpreted by banks, as we found that banks are using online warnings to shift the blame onto customers and avoid refunding losses. “

Which? has also pointed out that different banks are interpreting their obligations differently under the voluntary code. Voluntary codes are not an adequate solution.

The CRM Code covers a specific type of fraud and legislation is needed to ensure that banks work together so that the receiving bank is made responsible to return funds paid into fraudsters accounts. If this does not happen the banks could fairly be accused of supporting crime.

I don’t see the point of this discussion because what needs to happen to protect the customers of banks is very clear.

They may be interpreting the degree to which they and their customers have responsibility for a loss, which is not the same as interpreting their obligations differently when a situation is not cut and dried.

What is clear is that fraudsters perpetrate scams. What is not at all clear is how you prevent that. Nor is it clear how you assess the degree of responsibility of those parties involved. I would hope a Convo like this would explore the subject with expert assistance.

I have suggested naming those banks that stand out as hosting fraudulent accounts, if that is the case. I have also suggested insurance for those who are scammed to be a potential funder when they are unable to recover their funds and whose bank has played no part in the loss, other than following their client’s instructions.

Delayed payments have been mentioned as a solution. That may help; we do not know. Worth trying. However, customers can already do that when they set up the payment.

Perhaps constructive proposals would promote new discussion, rather than going over the ground already covered in previous comments and Convos.

I don’t know how easy or practical this would be to implement effectively when there are 2.4 billion personal online transaction a year. However, big data is clearly processed by others. It is the examination and, presumably referral bit, that may clog the current system. It would need to be weighed against the number of scams that take place, which I estimate is 4 in every 100 000 transactions.

I agree Wavechange, if the banks unwittingly transfer customers money into a fraudsters account they are in fact. unwittingly and unintentionally an accessory to a criminal offence. There are always going to be people who are more susceptible and vulnerable to being targeted by scammers. One doesn’t expect the same vulnerability and susceptibility from professional bankers.

I doubt the banks have any culpability and that they are any accessory in the circumstances described. It is not banking professionals who respond to a scam but their customers.

I hope we can move forward to looking at how customers can be helped to avoid scams and how the banking systems can be improved to detect potential frauds being perpetrated. But some crystal ball gazing is the requirement of some suggestions.

I have made suggestions elsewhere as to how the more susceptible and vulnerable customers could be helped but these, and other proposals, seem to get left behind in a drive seemingly aimed at compensation, when we should be looking towards a remedy rather than a sticking plaster.

Delayed payments have been mentioned as a solution. That may help; we do not know. Worth trying. However, customers can already do that when they set up the payment.

If enforced it would allow breathing space–the single thing the scammers don’t want you to have.

APP (Push payment scams) work because the unwitting victims are panicked into acting
precipitously, without having time to consider what they are being asked to do. Given that they’ve become so prevalent one might be forgiven for asking why the banks have done almost nothing until reluctantly introducing a (flawed, from my experience) name recognition system.

From the moment I started using online banking I queried why we could only enter sort codes and account numbers, and not see names. Making a mistake with numbers is far too easy, while seeing a name makes things far safer.

Instead of excusing the banks we should be dong what Which? is now doing, and starting to pressure them into behaving appropriately.

It’s the banks’ responsibility to devise systems that ensure online safety.

I have made suggestions elsewhere as to how the more susceptible and vulnerable customers could be helped but these, and other proposals, seem to get left behind in a drive seemingly aimed at compensation, when we should be looking towards a remedy rather than a sticking plaster.

But if the banks are forced to take the security of their customers more seriously by a threat of compensation, then perhaps they will act.

I may be mistaken, but my distinct impression when this subject was first covered by Which? was that while many were wholeheartedly in support of Which?, others posted that they didn’t see why their money should be used to compensate those who weren’t – in their opinion – careful enough.

This is what has prompted me to support Which? in this particular matter.

The question is, if and how any refund is to be calculated; in my view, that should be based on the degree of responsibility of the parties involved in the conduct of a particular transaction . I do not want to see my money (and yours) used to refund everyone with no regard to how irresponsible or careless they might have been. Apart from anything else this will simply encourage some to take less precautions if they know they cannot lose. That was a stated position from the beginning.

Excellent. That’s a good and clearly stated position. Only one thing remains, then: clearly stated and precisely defined exemplars of what constitutes irresponsible or careless behaviour.

But there are other questions. If your bank carries out your instruction to transfer money to another account and it has no way of knowing whether that account is held by a fraudster and is actually committing a fraud, why should they automatically refund you if you are defrauded?

If I mis-type the amount I intend to pay- an extra 0, or a 9 instead of a 0 – who is responsible? If I pay for a too-good-to-true offer, such as the storage units with a 50% annual return I quoted, should the bank give me my money back and why.

We should not only look at the customer but also ask about the bank. Under what circumstances should a bank be liable to repay its customer. What does it have to have done to make it culpable?

But if we just want to protect customers from the consequences of making a mistake in a transaction then I think we need an insurance scheme that we pay into. You can make a mistake when driving and cause damage; it may not be clear or matter whether road conditions contributed, whether a peripheral action distracted you, whether the telegraph pole could have been better sited, whether you were driving badly and made a misjudgement, your insurer will fix your car. You will pay an excess and next year’s premium will rise. But, if in your financial transaction the insurer investigates and finds that you acted recklessly with insufficient regard for the consequences they may well not pay out, just as they won’t if you drive under the influence of drugs. Our actions need to be appropriate.

We should deal with those who are mentally less capable separately; I believe their banking arrangements need to be specially dealt with. But the bank needs to know a customer is in that category; I do not see how they can generally be expected to know Mrs X now has dementia or Mr Y has lost mental capacity unless they are informed.

If your bank carries out your instruction to transfer money to another account and it has no way of knowing whether that account is held by a fraudster and is actually committing a fraud, why should they automatically refund you if you are defrauded?

If you mean it has no way of knowing whether that account is being used fraudulently then I would suggest that, rather than the bank being the sole arbiter of the event, as they are now, such cases need to be removed from the bank’s purview and submitted to an independent body.

If, as you have pointed out, these scams only account for 1 in every 25,000 transactions, then this shouldn’t be an onerous or time consuming process.

If I mis-type the amount I intend to pay- an extra 0, or a 9 instead of a 0 – who is responsible?

This bring us back to the banks’ own systems. They should, by now, be pretty nifty with algorithms that can detect unusual instructions. They do, after all, employ them to protect themselves from online theft, so I would expect the bank, knowing its customers’ profile, to detect unusual payments.

In days of yore, of course, the friendly bank manager would give you a call, personally, to ensure nothing was amiss. But their relentless pursuit of profits has seen them close most of their branches, so a friendly call is now almost non-existent.

In a sense, then, it becomes partly their responsibility.

Fundamentally, I don’t disagree with the notion that compensation should not be automatic; but what I do feel, and very strongly, is that the banks need to take a long hard look at themselves and their processes, and develop systems that can adequately monitor online procedures. We have the technology: time it was being used to protect the customers, as well as the banks.

According to the Alzheimer’s Society: “Dementia mainly affects people over the age of 65 (one in 14 people in this age group have dementia), and the likelihood of developing dementia increases significantly with age.” There is no simple test that can easily be carried out and as we age the risk becomes greater. Furthermore, a significant number of intelligent adults have dyslexia and other conditions that could affect their ability to see their own errors. That is why confirmation of payee should have been in place when online banking became available to the public.

In order to have a workable banking system the banks must recognise these human limitations. Banks could restrict account facilities to new customers and restrict facilities to those who have lost money as a result of a scam, etc.

Once it was explained to me that the CRM voluntary code applies where customers are tricked into parting with money I support the efforts of Which?

The banking system must work together to ensure that accounts run on behalf of fraudsters are made liable to return funds to the paying bank so that victims of fraud can recover their money.

If the bank had done its investigative homework at the point of inauguration there would be fewer cyber criminals for them, and their customers to worry about.

I, too, believe the receiving bank should be liable to recover and return funds acquired fraudulently. However, this often seems to be based on the premise that they should take more care when opening new accounts to check the credentials of the account holder. An example quoted has been when students, quite legitimately opening accounts, sell them to fraudsters. I don’t know how real this is as no evidence has been given. But as an example of a way the bank can be totally deceived should it still be liable when it has done nothing negligently?

In my view, so much comes down to what a bank should or should not be expected to do. At one level, therefore, we should judge whether a bank has been knowingly negligent; if it has not then why should it be held liable? At another level we should take a more compassionate approach and say, well the bank behaved quite correctly, the customer instigated a deficient transaction, but because the bank has a lot more money than the customer we should take pity and refund them. Put bluntly it seems to me those are among the arguments being propounded and we need to be clear about the grounds we are using.

investigative homework at the point of inauguration”. Perhaps you could enlarge on this?

Accounts can be monitored by computer, which would flag up unexpected activity involving accounts that had previously been used without problem. If the receiving bank is made liable for refunding money there is a strong incentive to do this.

With scamming becoming more lucrative the banking industry is in the best position to take effective measures and once again I suggest that each case of fraud is investigated and that customers have access to independent appeals if they are not happy with how their bank has handled the case. A fee might be appropriate to discourage pointless appeals.

Clearly by the time unexpected activity has been detected fraud(s) will already have been committed. As the bank could not have been aware of this until that point I do not see why, in law, the bank should be held liable for those prior transactions.

This is not a simple issue to find a resolution to.

I maintain that as it is the customer, not their bank, who responds to what may turn out to be a fraudulent transaction, in the absence of any negligence by the bank or the system the focus should be on them. If we want to compensate them out of sympathy then we need a fund from which to provide the money. That fund should be formal, as an insurance, rather than just taking it from other customers.

Your bank could explain this better than I.

If students sell bank accounts they are committing a crime and should be prosecuted. If they lend them out, they should be responsible for the outcome. It should be clear to any bank that this is not a typical student spending and receiving scenario. A few well chosen warnings at the start of the term might help here. Additionally students are then risking blackmail and pressure to commit further crimes for their unscrupulous purchasers.

Malcolm wrote: “Clearly by the time unexpected activity has been detected fraud(s) will already have been committed. As the bank could not have been aware of this until that point I do not see why, in law, the bank should be held liable for those prior transactions.

This is not a simple issue to find a resolution to.”

Unless the receiving banks do take action we are likely to see fraud escalate and banks’ customers – like us – could lose our money.

Our savings are usually protected, within the limit, by the Financial Services Compensation Scheme, through a levy on members: https://www.fscs.org.uk/media/press/2021/jan/202122-plan-budget/ Maybe it could be argued that the public should not have invested in a company that was failing. Those who pay for goods and services by credit card are afforded protection. Those who have bought energy from a small energy provider that was not financially secure will not lose their money. If receiving banks are providing services for fraudsters, either from the outset or years later, I believe they must make provision for refunding money to the payers’ banks.

All these schemes are paid for out of our pockets in the end, not the banks or energy companies. As far as I can see, the huge interest charges on credit cards – money supplied by customers – will fund refunds.

All customers will suffer equally if a bank fails (when was the last time?) and most will be totally protected. Unlike making payments to a fraudster the customer is just an unengaged bystander in a (possible) bank failure.

If ways to improve the banking system are put forward that are feasible, practical and will stop all fraud then let’s hear them. In the absence of a foolproof system it seems to me to come down to: was the bank legally negligent; if so it should refund some or all of the money lost. Was it in no way negligent; in which case either it makes no refund or we set up a scheme whereby ex gratia payments are made (if you like, out of sympathy). But this should be properly funded and not just taken off the banks – essentially its customers.

I think we must be clear about what we want to achieve and how.

Presumably it is illegal for a company to provide banking services for fraudsters and the responsibility must lie with the receiving banks. In other Conversations we have discussed the need for retailers to ensure that manufacturers and companies in the supply chain comply with the necessary safety standards to protect us, the consumers.

How does a bank know? I could decide to use my account to commit a large fraud; my bank would have no idea that I might do that.

No impact has been made on marketplaces’ ability to supply us with dangerous non -compliant products until the fraudulent ones are out in the market, some discovered and temporarily removed from being listed.

We need to decide where legal responsibility decides the outcome and when we decide we want a sympathy response. The fraud would not be committed without a customer responding to an offer; when that offer is responded to without due diligence then the customer has at least a partial responsibility for an unfortunate outcome. If I “buy” 2 pairs of Loake shoes for £40 online and, instead, receive a pair of cheap sunglasses have I no responsibility for the outcome? Simply giving continual reimbursement opens the floodgates for criminals to rip us off, we don’t care because we’ll get our money back, but all those other more responsible people will lose by coughing up the recompense.

We’ve already seen the failure (in my view) of sympathy campaigns where there are unintended (but quite foreseeable) consequences) as in the authorised vs unauthorised overdraft saga.

I too am mystified by the phrase “investigative homework at the point of inauguration“. Is this some arcane piece of banking terminology? I am not sure I could ask my bank to explain it because I don’t know its context. “Inauguration of what?”, I am tempted to ask.

If, by chance, it means at the point when a bank signs up a new customer, then it would be interesting to know what checks and enquiries can legitimately be made by a bank before providing banking services, and how deeply they can probe into a person’s history. They can check their credit history, and take up references, but I expect fraudsters present a clean image to open their first account, subsequently move to a different bank with the benefit of a good record and credit score, possibly then open a bank account in a foreign jurisdiction, and eventually start their racket. Money flies around between different accomplices at a speed with which the system is not equipped to cope. If fraudsters get one decent target a day they can make hundreds of thousands of pounds a week so they can take their time and make sure their network is fairly secure among themselves and fairly untouchable. They can afford to reward their intermediaries adequately to avoid the risk of betrayal.

My very first bank account was with the London Trustee Savings Bank. It was operated with a passbook which had to be presented at your branch for each withdrawal and you would have to go into the bank to get a cheque made out to another party. I am pretty sure that arrangement would have stymied the fraudsters. The process was so slow there were queues out of the bank and into the street on a Saturday morning. Should we return to the “good old days”?

An example quoted has been when students, quite legitimately opening accounts, sell them to fraudsters. I don’t know how real this is as no evidence has been given.

The Giuardian and Monzo have done some investigations.

Malcolm says: In my view, so much comes down to what a bank should or should not be expected to do. At one level, therefore, we should judge whether a bank has been knowingly negligent; if it has not then why should it be held liable?
I suspect this comes down to what society deems as ‘negligent’. Banks make it very difficult to open an account. It might reasonably be asked, then, why do they not continue to monitor accounts?

John – I had wondered if scammers were using business or personal bank accounts. If the latter then perhaps the number of payments received would be a useful indicator that not all was well.

Some of us have discussed the possible benefits of delaying payments as a measure that could provide time for account holders to contact their bank and report suspected fraud, giving time to investigate and if necessary stop the pending payment. I have suggested that this would be appropriate for payments to new payees but not for payments to existing payees or for amounts below a certain threshold.

My bank did not provide me with a cheque book when I opened my account and eventually I asked for one. In these days it was printed on the premises and it was a few years before I received new ones automatically by post.