/ Money

Scam protection: FCA proposals will boost complaining power

The FCA has announced proposals to give victims of bank transfer scams more scope to make a complaint, and increase the powers of the Financial Ombudsman Service.

We’ve been campaigning for better protection since launching our super-complaint in September 2016. Under current regulations, you have no right to complain to the bank that received your funds if you think it hasn’t taken sufficient action, but this will soon change.

The proposed changes will also allow victims to escalate complaints to the Financial Ombudsman Service, so this is undoubtedly a step in the right direction.

Sophisticated fraudsters

Victims of this type of money transfer scam have told us that it can be a real struggle to get their complaints heard and to find out what has happened to their missing cash.

This is extremely distressing for people who have often lost life-changing sums to these increasingly sophisticated fraudsters.

We welcome the FCA’s announcement that gives victims new rights to ensure that the recipient banks and building societies are fully engaged in the complaints process and gives them the right to take their case to the Financial Ombudsman if they feel they have been treated unfairly.

Improving protection

In response to our 2016 super-complaint, the PSR set out an action plan to encourage great co-operation between banks, introduce anti-fraud measures and give victims more power to recover their funds. It also announced a contingent reimbursement scheme.

A ‘confirmation of payee’ tool is also due to be rolled out later this year, which will require banks to check the name provided on the transfer against its account records. If it doesn’t match, the customer will be alerted.

These developments and today’s proposals are welcome steps forward as we continue to call for the government, regulators and businesses to do as much as possible to safeguard us all from scams.

We don’t want to see banks getting let off the hook and scammers getting away with fraud. Agree? You can sign our campaign here.


Banks should be able to trace where money has gone!

They can – and will – if they think it has gone to the wrong place, but if it’s gone to where their customer directed it they see no need to intervene.

When I was banking with Barclays their computer blocked a debit card payment of £5 (to Mozilla) because it was “unusual” because it was going to the USA and I had to explain it. If they could do that for such a small sum they could surely get their computer to block the extremely rapid payment out of the large sums typical of the bank transfer scams unless the account holder could explain why such a transaction was occurring on an account which hadn’t a history of such transactions. This might not stop it entirely but ought to make it more difficult for the fraudsters.

Banks are VERY quick to know when THEY have lost, even a few coppers, but when it is a customers money there is always an excuse for them not being able to retrieve or assist in retrieving your money.
Do not forget that as a business customer we are paying for this terrible service.

Also, it is about time that banks accept that contactless cards are not safe. I believe banks have stated that they will refund money after the card has been reported as compromise, by then your copied card has been used to empty your account & it is only when your account is empty that you know your card has been copied. To my mind it makes the banks as corrupt as the thieves

I think they could do more if they could be bothered. Surely in this advanced technological age there should be some sort of mechanism? I bet they’ll come up with something pretty quickly if they think they might be fined for failing to protect their customers. Goodness knows how we’ve propped THEM up in the last few years – time to give back – and then maybe they might justify paying bonuses to people who are just doing the job they are paid to do.

Morris Manson says:
5 July 2018

It took me over 40 minutes and immense amounts of info to set up a second current account with the Coop bank whom I have been with for well over 45 years !! so this setting up of scam accounts that can be opened and immediately closed when funds have been transferred should be controlled and perhaps outlawed by the National and international banking system – this is at the very heart of these scams – namely that the receiving account cannot be traced. Time for the banks to take responsibility !

Shirley says:
5 July 2018

Banks should know their customers better, and know when something is out of the customers usual order. Any large amounts should certainly be delayed until they have contacted the customer to confirm
After all they are the trustees of our money, and they do not pay decent interest whilst using our money.

Tony Osborne says:
5 July 2018

I have said for years……
The receiving bank should, on receipt of a crime number, refund all the fraudulently obtained money.
It is then up to them to reclaim the money from their customer.
If they can’t find their customer, they haven’t checked properly when they opened the account.
That would concentrate their minds.

Just a thought … I bank with the Nationwide and they have some very good security measures in place to determine that it is, in fact, me when I call them yet shouldn’t it be a two way thing so that I am also certain that I am talking to the right people ? e.g. I recently responded to a voice mail, supposedly from Nationwide, asking me to call an 0800 number regarding a recent ISA transaction. In the end we did establish that the call was genuine but surely it would have been simpler if I was allowed to ask them to provide me with a particular piece of information, about myself, from their records. This could be something as simple as me selecting a random transaction, from a recent statement, and then asking them who I paid a specific amount of money to on a specific date e.g. Who did I pay £53.22 on 16th March 2018 ? If they answer correctly (i.e. Wyevale Garden Centre) then there is a pretty good chance that I am talking to my bank.

Or even easier if they ask you to call them back on the phone number you already have for them? Just as you should never respond to a link in an email; use the contact details you already have.

No organisation handling money should be making calls and providing a number, which may or may not be genuine. If my bank did this a complaint would be sent to their head office. What is Nationwide playing at?

It will depend upon whether the phone call was to request sensitive information, or to ask a routine question. Many years ago I made a purchase at a service station a long way from home and my credit card provider called me to check the purchase was genuine. No inappropriate information was exchanged.

Automated customer text alerts and voice calls
Automated customer contact
As part of our commitment to prevent fraud, if we spot an unusual transaction a block may be placed on your card. We will then contact you using our automated service to confirm if the transaction(s) are genuine. This is a quick and easy way to either confirm fraud or remove the block from your card.

There are two ways in which our automated service may contact you:

Text alert
Voice call
Automated text alerts
Automated voice calls
About automated voice calls
You will receive a voice call from our automated system and be asked to identify if you are the account holder. To confirm your identity, the automated service will provide a choice of birth years for you to select from.

If you cannot answer the questions, you will be transferred to a Consultant.

You will not be asked for your account number or PIN.

If you are the account holder, you will be asked to confirm whether recent transaction(s) are yours using your telephone keypad.
If you confirm the transaction(s) are yours, the block will be removed from your account. The transaction(s) may need to be attempted again.
If you are unsure if the transaction(s) are yours or you did not make the transaction(s), you have the option to be transferred to a Nationwide Consultant.

If a bank makes a call and provides a number to be called, this is very bad practice because of the possibility of fraud. In his post, Steve said: “I recently responded to a voice mail, supposedly from Nationwide, asking me to call an 0800 number regarding a recent ISA transaction.” That is poor practice. If you have initiated the call, that is different.

I have had similar calls to the one you have mentioned, Malcolm, and I see them as good practice.

As well as the banks, people should take more care of their money. If it looks too good to be true it is often a dodgy deal. If the markets are paying 1.5% and someone offers you 10% then be very very careful.

The big danger in compensating scams is where you draw the line between a genuine scam that has been allowed by a banks negligence, and where the customer has made a complete or substantial contribution that results in them losing money. This is part of the consultation process being undertaken by the PSR.

The other problem is that of lulling people into a false sense of security, when they might take less care over their transactions in the belief that if they slip up they will be refunded anyway.

As Simon says, people need to take care of their money. And, I would add, not make transactions they do not understand.

The simple solution is to make the bank holding the scammer’s account liable for returning the money at their own expense. Banks are clearly allowing scammers to set up accounts for carrying out fraud, so what has happened to all of the checks they are supposed to carry out on new bank accounts to prevent money laundering? They are supposed to clearly identify the person opening the account, so why can’t these scammers be traced and charged with fraud?

roland north says:
5 July 2018

banks should re-check with customers either by phone or e-mail before unusual cash transactions are carried out…they are the one’s making millions from our monies,so phone calls are peanuts to them and e-mail time…better to be safe than sorry…this would stop scammers in their tracks.

Roger Holton says:
5 July 2018

As most scammers prey on the elderly, banks serving these customers and thereby profiting from them being subscribers, shoud do more than shrug their shoulders or say “we’ll look into it(But drag it out). And then mostly say, “Sorry, we can’t really do much in this instance because……. Let them be held responsible to their customers.

Banks should supply free software for on-line banking – which is known to be safe and secure.
Barclays used to supply Kaspersky, but have now stopped.

This comment was removed at the request of the user

“Kaspersky Labs: Warning over Russian anti-virus software………

Barclays axes deal
Officials stress they are not recommending members of the public or companies stop using Kaspersky products, which are used by about 400 million people globally.

Barclays has stopped offering free Kaspersky software to customers as a “precautionary decision”.

On Saturday, the UK bank emailed 290,000 online banking customers who had downloaded Kaspersky over the past decade – but advised those with the software already installed to take no action.

A Barclays spokesman said: “Even though this new guidance isn’t directed at members of the public, we have taken the decision to withdraw the offer.”

If software might be regarded as potentially threatening, it would be silly not to take precautionary measures. If we did not, and a security breach resulted, we could be more than critical.

Maureen Boyd says:
5 July 2018

Most of the scams are done through newly set up accounts so banks shouldn’t allow large sums of money going into new accounts to be removed within a short period of time and only transfers to another bank account permitted with the same time limits again if the account the money is going into has recently been opened. If there was a time limit before the funds were released, hopefully, the fraud will have been picked up by the victim. There should be more checks on bank accounts being opened although fraudulent documents seem all too easy to get. Perhaps there could be a centralised system that checks
customers names and account details match and any changes recently made should be double checked before transactions can go ahead.

What I wonder is this, are there sufficient people in banks who see dodgy transactions. Technology is good but it still needs human intervention to spot and do something to block bad transactions.

Colin says:
5 July 2018

I have opened a basic bank account which I use for most of my online purchases and just add money to this account when I want to purchase leaving near zero in when not spending therefor if somebody gets my
details for this debit card the bank will not let them spend because there is no money in.

This comment was removed at the request of the user

Judy Godfrey says:
5 July 2018

On the positive side I have recently had 3 fraudulent transactions (in the past year) and each time I phoned my bank they refunded my money without a quibble. Yes, it’s a pain having to change card numbers with various accounts I hold, but the replacement card came through pretty quickly so I was inconvenienced for as short a time as possible.

I agree there must be some way these transactions can be identified, but short of keeping your own purchase ledger type of hard copy and reconciling it with your statement, I can’t think of an easy way for banks to know which transactions are likely to be fraudulent. As previously stated – if your bank knows you and there is an unfamiliar type of transaction they will call you to check if it’s ok.

Sean O'Brien says:
5 July 2018

Seems to me that the Banks need to make more stringent checks when an account is opened. I cannot believe that this cannot be done and if it makes opening an account harder so be it.

If the Banks became legally liable or responsible for fraud than I think they would try harder.

We receive a poorer service from our Banks every year what with closing branches, impossible questions and closing of ATM’s and yet they continue to make obscene profits.

Sadly I too do not do any form of internet banking because if anything went wrong I do not trust my Bank to put it right.

One reason why fraud is so prevalent is that the fraudster knows that they can easily get away with it. The burden of proof required by the law is so stringent – beyond all reasonable doubt – that their chances of conviction are negligible. I would introduce a new fraud act that would place the burden of proof onto the accused- having been found to be in possession of the said monies or participated in their transaction to a third party, the accused would have to satisfy the court that all monies found to have passed through their hands were the result of legal transactions. If they could not so do, the court would have no choice but to find them guilty as charged. All the accused’s assets would be impounded by the court until its final decision was reached, suitable charges being levied by the court for its services. Fraud is a crime always carried out with malice aforethought, as was previously recognised. In the 18th C the accused could have been placed in a ‘squeezing house’ and slowly relieved of his ill-gotten gains by hugely inflated prices for food and drink. The lawyers would of course, rub their hands with glee at the prospect of endless fees, until the accused was reduced to penury. In the event of a guilty verdict in the 18th C, then there was a guarenteed trip in a cart to the Tyburn Tree to meet Jolly Jack Ketch and after a brief spell of tap dancing on fresh air, why, they never did it again!
Yes, there are practical and effective measures to be taken to reduce fraud, fraudsters should be well aware that a public tired of their deprivations, might clamour for a return to some tried and tested remedys!