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Are banks doing enough to stop scammers?

transfer-scammer

At today’s British Bankers’ Association’s annual conference, Which? will outline why banks should be doing more to protect their customers from bank transfer scams. While much has changed since the days of the financial crash, there’s still work to be done…

The crisis that started in the US subprime mortgage market 10 years ago rocked the international banking industry and led to a breakdown in faith in the system across the board.

Consumer trust in financial services had already been damaged by the PPI mis-selling scandal, low levels of competition and poor customer service.

With bankers ranking even lower in the public’s mind than estate agents and politicians, many thought the sector would never recover.

What’s changed?

A decade on, and a lot has changed.

In 2010, I established the Future of Banking Commission, chaired by David Davis MP, to investigate the banking crisis, and with many of our recommendations now adopted, trust in the industry has risen.

We’ve seen a new and more powerful regulator in the Financial Conduct Authority (FCA), which has made a real difference to the way consumer banking issues are addressed. Moves to tackle banking culture have started to pay off. And emerging app-based banks, such as Starling, Monzo and Atom, are joining TSB and Metro Bank in challenging the status quo.

Online banking

We should recognise that progress has been made. But this is no time for bankers to rest on their laurels.

The last decade has not only been about attempts to fix the mess of the financial crisis. We’ve also witnessed a huge shift in consumer behaviour as the majority of us moved to banking online. This has brought enormous benefits as people can easily make transactions and better understand their spending patterns.

But it also carries risks. One of the biggest is that scammers can quickly con victims into transferring their hard-earned cash out of their bank account. Once the money has gone, the victims soon find there is little chance of getting it back from the banks involved.

Bank transfer scams

Since we made a super-complaint about bank transfer scams to the Payment Systems Regulator (PSR) last September, we’ve heard hundreds of stories of how people have lost life-changing amounts of money this way. Collectively, they were scammed out of £5.5m.

Take the couple defrauded out of £47,000 when putting a deposit down to buy a house. They received what appeared to be a genuine email from their solicitor with instructions on how to pay.

The fraudster opened an account with a prominent high street bank and used it to steal this couple’s cash.

Despite the fact that almost £50,000 was being transferred to an account the couple had never paid into before, the bank raised no questions about the transaction. Within a few hours, the fraudster cleared the account – again, no questions asked.

Banks’ customers have been losing large amounts of money to these types of scams for some time now. And as more of us bank online and scammers become ever more sophisticated, this could grow and grow.

Taking measures

Last month, we wrote to the banks to ask them what preventative measures they’ve put in place following our super-complaint.

Although they’ve started to use more explicit warning messages and have attempted to raise awareness and educate their customers, they seem to be suggesting that the solution is that customers should be ever more vigilant and spot scam themselves. Even in situations where they know people are vulnerable.

If this is to be the limit of the industry’s response, then it suggests they haven’t fully learnt the lessons of the financial crisis. Surely if that taught us anything, it was that banks need to be on the front foot, championing consumer interests and addressing their customers’ issues rather than waiting for regulators or governments to force change.

At today’s British Bankers’ Association conference, we hope to hear first-hand from the industry about how they will step up and be assured that more is planned to address these awful scams.

We all need to be reassured that the industry has truly changed.

Do you think banks are doing enough for their customers? What more could banks do to protect consumers from scams?

This is an edited version of Peter’s original article for The Telegraph, published online on Thursday 29 June 2017.

Comments
Guest
Reginald Parker says:
29 June 2017

Historically and in my experience, the Boiler Room Scam was identified over 10 years ago, and the then Chancellor of the Exchequer chose to ignore alerts and evidence placed before him. Subsequent Chancellors have been able to prevent it’s disclosure to the general public, so that it was only made public recently and in one case only. Millions of pounds were involved. No other prosecutions have been brought. Can the public be certain that scam is not to be prevented? Banks and the Stock Exchange had been aware as long as the Chancellor. Are they acting positively on this and other major scams, or are they still allowed to be complacent?

Guest
bishbut says:
30 June 2017

Unless some MP is personally scammed and loses a lot of money they will be in no hurry to do anything
Again some People will always fall for the simplest and most well known scam whatever any one does
Banks and others must do more though

Profile photo of PatrickTaylor
Guest

conversation.which.co.uk/money/bank-transfer-scams-preventative-measures/

My original response here has been removed and this article rewritten to remove this:

“Surely if the events of 2007 and 2008 taught us anything, it was that banks needed to be on the front foot, addressing their customers’ concerns rather than waiting for regulators or governments to force them to change.

I hope that the banks really have changed. I want to be confident that lessons have been learnt and that the banking industry wants to put its customers first.” DT
telegraph.co.uk/personal-banking/savings/banks-want-trusted-need-stamp-scammers/

I was fairly rude about this passage as it seems to indicate that despite the majority of the nation knowing that Banks are and always have been businesses that put profit first and will never do anything purely for consumers benefit this idea is not held by the CEO of the charity.

Profile photo of wavechange
Guest

I very much agree, Patrick, that the banks and other sectors should act promptly to recognise the need for action before the regulators and government has to take action. There seems to be a view that it is not possible to run a business profitably if you take responsibility for the needs of customers, but I do not believe that this is the case.

Profile photo of malcolm r
Guest

The view you portray is not one I have seen expressed. Perhaps you could link to it?

Banks and other institutions may well take action when problems with systems appear.

Profile photo of wavechange
Guest

Check your own posts, Malcolm. It’s evident that you see serving the needs of shareholders as first priority. A bit more effort on corporate social responsibility could mean less work for the regulators and less new legislation.

Profile photo of malcolm r
Guest

wavechange, you can check my post of 30th June that happens to follow your comment. This represents my consistent view on a number of Convos. 🙂

Profile photo of wavechange
Guest

We have acknowledged that there is a duty to protect the vulnerable but the point that I have been making is that there are others who are not vulnerable but at risk of losing money or being charged more for energy because of their situation. I believe that it is the responsibility of businesses to take into account the personal circumstances of their customers.

If you have certain medical conditions you will be expected by the government to provide evidence that you are fit to continue to drive. Perhaps our banks should regularly review the fitness of their customers to continue to use services, or even fitness to use them in the first place.

Profile photo of malcolm r
Guest

It is occasionally said that we should be careful what information we give to businesses. How should they therefore be informed of our “personal circumstances” ?

I believe the vulnerable should be helped, but of course they need to be identified in the first instance. I’m not clear how this should be done, and how this information should be made available to the businesses they need to deal with. Maybe a Convo could discuss this?

It may be that some banking services should no be given to certain people, if they are in danger of having those services compromise them, or if they are not capable of using those services correctly or reliably. Services designed specifically for vulnerable, or less capable. people maybe should be offered.

Those over 70 simply declare their fitness to drive, unless they wish to continue driving certain classes of vehicle.

Profile photo of wavechange
Guest

We have had extensive discussion about the vulnerable and benefits are available, but I would rather they were not exploited in the first place.

My view is that the privilege of using banking services should be earned, but the problem is removing existing privileges if the need arises. It’s certainly something that would be worth discussing.

Self-declaration is widely used as evidence of fitness to drive and do other things where there is an element of risk. Some of our charity volunteers have been trained to operated machinery and must self-certify that they are fit to continue, and I have to countersign their application to confirm that I support this.

I am certainly not suggesting that official information should be passed on to banks or other companies but it certainly helps business to be able to check the credit rating of customers.

Profile photo of malcolm r
Guest

There is a regular opinion from some contributors that businesses should all put customers first. Businesses are formed by investors risking their money hopefully making a return on their investment. So, to survive, businesses must make profits. However, at the same time businesses must sell their product, and that requires customers. Therefore the consequences of the impact of their service on customers is a prime consideration as, without continuing custom, their business will fail. This applies to banks as well as others.

The frustration is that many customers accept service that some others consider unacceptable and, unprepared as they are to vote with their feet, change – if any – is at best sluggish. That is why we need a proactive consumers’ organisation to catalyse change – but only if it does so from a balanced and fair perspective. It needs, in my view, to work with the banking industry to see what is being done, to put proposals forward as to what could be done, and to keep separate customer stupidity from customer ignorance. Education should form as much a part of this as well as reform.

I am for cooperative and constructive progress, not partisan campaigning.

Profile photo of wavechange
Guest

I don’t see voting with your feet as an adequate solution because you may have already spent hundreds or thousands of pounds on goods or services and been let down.

It’s not helpful to refer to customer stupidity.

Profile photo of malcolm r
Guest

Some customers do silly things with their finances – that it was I mean wavechange. You cannot protect some people from themselves.

By voting with your feet I mean, of course, if you unhappy with, in this case. your bank. unless you have an ongoing problem then move your business to another one. I can recommend mine, as have many others.

None of this meant that we should not seek to have services improved but we should hope to do it in a knowledgeable and cooperative way. Which? has a tendency to only present one side of the argument; I’d like to see them look at it in the round and work with the industry to see the problems they need to resolve and what they are doing to achieve this, for example. I prefer to be made an informed consumer. There is work being done and I hope we will be updated with progress.

Profile photo of wavechange
Guest

I advocate that people are careful too, Malcolm. As I’ve mentioned before, I’m happy with my bank and don’t see any point in changing.

My point is that if I had already spent money on a product or service that was unsatisfactory then it’s little help to be told that I can vote with my feet. Fair enough to vote with your feet if service deteriorates or prices become excessive, but if it’s a one-off purchase I need to know that the company is going to behave responsibly. For example, will I be turned away by a retailer if I may have a valid claim under the Consumer Rights Act for goods just beyond the guarantee period. As we both know, we often have to fight for our rights. Let’s put the customer first and make sure that all retailers entertain the possibility that we may have a valid claim and act accordingly.

To look at a relevant topic to this Conversation, imagine I had made a one digit error in my sort code or account number and paid the wrong person or company and they refused to refund my money, despite the fact that they have failed to use the name of the payee. (It’s hypothetical because I have never done this.) It’s no help being told that the PSR are looking into the matter because the banks should never have been allowed to operate in this way. I believe that this is a reasonable example of ‘putting the customer first’. Until the problem has been rectified I would like to see the banks responsible for refunding customers’ money unless it can be shown that a customer had behaved irresponsibly. That might just encourage progress in achieving a solution to what is a long running problem.

I accept that the approach by Which? can be a bit one-sided, but is that any different from advertising by companies, which can be full of misrepresentation. Which? does not generally have a go at companies and other organisations unless they are letting consumers down. If they wish to take legal against Which? then let them, or they can publish their grievance in the press or on their website. I don’t think that is likely to happen very often because it might help publicise the fact that Which? has a case.

Profile photo of malcolm r
Guest

My comments relate to the topic of this Convo, banks, where we have an ongoing relationship that we can choose to terminate.

It is important to make sure you put in the account number and sort code correctly. I always double – or triple – check before I make a transaction and for a new payee generally move a small amount as a check before the main transaction. Banks are required to help if you do make a mistake but cannot be expected, in my view, to be held responsible for customers errors.

The payees name is for the payers reference only and is not a part of the transfer process. There are reasons why this is not so, explained elsewhere (and Which? could do us a service by explaining this to avoid misconception). The banking industry is aware of the situation and part of the review is to see how more information is used to verify a transaction. Again, Which? could keep us appraised of this.

Advertising will not normally tell us the bad side of a company’s product – would you really expect that? But misrepresntation is different, and fraudulent. What examples of misrepresntation have you in mind?

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Guest

I know the reasons too, Malcolm, but the banking industry could have taken action years ago and there would be no need for anyone to make test payments.

Profile photo of malcolm r
Guest

I see no point in looking at the past, wavechange. We are where we are and need to progress. Online banking has expanded greatly over the last few years and this is where the problems that have shown up need to be addressed.

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Guest

I’m looking very much to the future, Malcolm. A time when it is safe to transfer funds without test payments and no bank or other institution involved in financial transactions put links in their emails.

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Guest

I was tickled by your delightfully prosaic and somewhat amorphous description of banks and business, Malcolm: Businesses are formed by investors risking their money hopefully making a return on their investment.

Somehow, it makes one feel for the poor, vulnerable investors, squeezing their last few pennies out of their life savings to sustain a struggling, charitable foundation such as a major international bank.

But I think you labour under a misapprehension. First off, that’s not really how businesses are formed. Most form because one or two people have discovered that people will buy into whatever they’re flogging, be it lamb carcasses or dead horses. It might be a group of people who have an idea, but mostly it originates with one or two.

If their ideas are liked by consumers, then money arrives and – in due course – if enough money arrives the initiators – always on the look out for more and more wealth – go public. That’s when investors arrive, but let’s be honest and not call them investors. They’re gamblers. Pure and simple. They have a lot of money to spare.

Okay; nothing wrong with a flutter or two, but describing them as investors risking their money hopefully making a return on their investment does tend to misrepresent what they’re doing. Massively.

There’s also a bit of a difference between Joe and Arthur Floggsummat, who start a cobblers at the end of the street and the likes of HSBC. Apart from the fact that Joe and Arthur probably care more about their customers, they’re closer to them, and almost certainly take more time over dealing with them.

That’s why Which? is plugging the idea that we need to expect a lot more from the banks. Don’t think of them as struggling businesses, whose investors are “risking their money hopefully making a return on their investment”. Think of them as your pet Chihuahua. that escaped when young and has returned to the neighbourhood having grown into a titanosaur Argentinosaurus huinculensis. Or, if it’s easier, a Tyrannosaurus Rex. The T-Rex is probably more appropriate, since it’s a pretty effective predator. But whatever, it’s no longer your loveable Chihuahua. And, if anyone is hoping to survive, it needs taming and controlling.

Profile photo of VynorHill
Guest

There seems to be three problems. Banks are more than just a business, they are also a social service providing a means for the general public to store, borrow, save and process its money. This is additional to their larger concerns with services to commerce and trading to make a profit. This being so, they need to provide a public friendly and simple access policy for their non commercial customers. Branch closures and complicated terms and conditions don’t help here. Not everyone has -or wants – internet access.
The second problem has been shown clearly by the banking crash and the fact that there is now a government guarantee in place for savers. This indicates that there is a possibility of a bank closing, and this from a previously cast iron industry is disturbing, however remote the danger. Who knows what, if any, warning signal might be given to the public before a bank closes its doors? The whole money market is a gigantic gambling casino and we are mere atoms in this microcosm of swirling currency and gilt movement.
Pertaining to this conversation, the third problem is one of sophisticated criminals, who are seldom caught, and vulnerable members of the public who are not as financially “savvy” as others. We read of millions of pounds going astray and many cases where banks have shifted the blame to their customers and refused to reimburse them. A fool and his/her money is soon parted, but banks do have a responsibility for their customers and it should be possible to detect unusual transactions and step in before they become fraudulent. If each account had an algorithm attached this would show what happened day to day and when that account stepped outside its usual parameters. It would also detect an unusual entry from outside the norm. There should also be a mechanism that triggers when a new account is opened to establish where the money is ending up. It is all too easy for a fraudster to open an account, commit a fraud and withdraw the money instantly. When this has actually happened , there is an upset customer and a bank with a problem to sort out. So, yes, a bank is a financial business with a hard nosed attitude to money making, but it is also a social service which we can not do without. The industry has to be soft nosed enough to be the public institution that we can trust and rely on to keep our money safe.

Profile photo of malcolm r
Guest

Vynor, I agree generally, although banks have always been vulnerable to commercial failure – that is nothing new. The customer protection to £85000 has been around for a long time now.

We do have to recognise that there is a banks’ side to the scam story, and be properly informed as to what that is. Just how do they detect a fraudulent account, do we want all our transactions held up whilst extra checks are made (we might), why is adding a third piece of information to a transfer – the name of the account holder for example – not as simple as many assume…… I’d just like to see this topic properly examined and reported. The industry is currently examining improvements.

Meanwhile I use online banking and have never had a problem with being scammed or with my bank. Am i lucky or just careful ( for example I always transfer £1 to a new payee to check, mainly, I’ve input their details correctly, and I would check if any email arrived to change payment details – so far it hasn’t). It may be good advice that if you are not happy with the security of online banking, and don’t feel comfortable doing it, then don’t. Use your branch or, if you don’t have one locally, use the post office who offer banking services for many banks.

Profile photo of John Ward
Guest

I respect your opinion, Vynor, but I am not sure that I can accept that banks should operate their personal retail services in the manner of a social service. It is a financial service and should not get blurred at the edges by contradictory objectives. Perhaps there is a case for setting up such a hand-holding bank run on philanthropic principles but I wouldn’t want to bank with an organisation that was not making a profit or running its business in a financially sound manner.

I do not see how banks can look out for deviations in customers’ transaction behaviour, at least not without charging more for the monitoring. I have an irregular expenditure profile with some fairly high peaks at certain times when buying things or transferring money from one account to another. I don’t want the bank trying to contact me to check whether I am doing the right thing, especially if it introduces a delay. I am rarely instantly available by phone so there would be a risk that if they couldn’t get hold of me they would suspend the payment.

I think banks need to make sure that the customers they attract are knowledgable enough and competent to run a bank account, and to make efforts to inform and educate customers so that they can protect themselves. I also believe they should stop making their operations so complicated with impenetrable terms and conditions and complex account structures that baffle people. They should stop making the availability of credit so easy as well – in their mad dash to acquire new business the banks are falling over each other to show off how easy it is to get a substantial loan with just a quick telephone call, no questions asked seemingly.

Profile photo of VynorHill
Guest

By definition, it is a social service. The public use it for their finances, there is no alternative available and it is an essential part of our lives. Your profile should suggest to the bank that they might expect the kind of account you outline and thus would manage it on that basis. Others would have different profiles and show up on bank computers in a different way. Not so much hand holding as keeping an eye open for anomalies. Would you deny the little old lady/gent on a state pension and a generous, trusting disposition a bank account? Perhaps banks should recognise this kind of customer and tailor an account to suit. A slight discrimination perhaps but avoiding trouble in the future. Again they could assess the person in front of them who needs to use their business. Maybe, they should be required to operate a hand-holding account in these circumstances, and, maybe this should, indeed be a social service in the non-financial sense.

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Guest

I agree with Vynor that banks should be more discriminating about who they provide services for, especially since banks provide a vital service. I support providing a limited service and let customers earn the privilege of more freedom. I have no personal grievances but it is wrong that my banking services are provided free of charge, funded by high interest rates paid by those in debt.

I have never been scammed, transferred money to the wrong account, or even paid overdraft charges but many have and I am not complacent and I believe that the banks could do more. I support the efforts of Which? in attempting to tackle various problems.

Profile photo of John Ward
Guest

I am afraid I have to disagree with you, Vynor. Retail banking is not a social service, which by conventional definitions is a service provided from a common fund. This is not the case with banking services – they are paid for by the recipient and in relation to the services provided.

So far as I am aware, the current account services I receive from my bank in accordance with the terms of the account are funded from the credit balances in my account. I do not believe any debtors are paying exorbitant interest rates in order to subsidise my banking. If I overdraw I will pay directly in relation to the amount and the period. The account terms give me a pre-authorised overdraft facility but if I use it I pay for it. If I want to set up an overdraft or take out a personal loan or a mortgage I will pay for it, and I will pay for arranging it as well – either as a direct fee or incorporated in the borrowing charges. If I exceed my pre-authorised overdraft facility limit without permission I will pay for that as well; I appreciate there is controversy over whether the rates for such borrowing are fair and are being cross-subsidised by other overdrawn customers but that is being debated elsewhere.

I am certainly in favour of banks [and other current account providers] exercising discrimination over who they accept and retain as customers, and which banking services they permit their customers to use. Home banking is not suitable for everyone. The faster payment service has potential pitfalls and customers should not be allowed to access it until the bank has satisfied itself that the customer is aware of the risks and of how to protect themselves, and is cautioned over the conduct of the service, especially by pointing out that there is no transaction monitoring and that more secure money transfer services are available [albeit at a cost and with longer timescales].

I do not want anybody in my bank, especially in a local branch, being able to see my account activity profile unless I instigate a transaction. I have been questioned by staff when I wished to withdraw a large sum in cash so that they could be sure I was who I claimed to be. I was asked to name some of my direct debits and I regarded that as entirely reasonable and a sensible security check, but I would not want the bank’s computer to flag up an apparent aberration so that a member of staff – who might be a near neighbour or member of a local organisation I belong to – seeing such information so that they can telephone me. Security cuts two ways and I have the right to enjoy privacy in banking. As to my personal account activity profile, outside of the dozens of regular direct debit and similar withdrawals, and routine payments to the same shops and services, it is so irregular and uneven that there would be no point in the bank’s system checking it either electronically or manually.

In view of the continuing but random number of bank service outages and unauthorised access attempts I feel that the less that banks process by background computer programmes the better – their systems have been shown to be out-of-date and poorly protected. I am not security-obsessed but equally I am not convinced that the banks exercise total supervision and diligence over the writing of software programmes to ensure that there is no misuse of data or hidden transfer of data to unauthorised recipients. I suspect that much of this work is carried out beyond the observation or understanding of higher management who cannot easily supervise it. I question whether there is adequate compartmentalisation of data to prevent internal cross-referencing for irrelevant purposes; in fact the evidence is that there isn’t because bank staff routinely engage in unrelated enquiries about insurance or mortgages or savings and investments when customers are transacting other business and they are prompted to do this by a flag on their computer screen – apart from distracting customers from the chief purpose of the visit to the bank it also makes them feel uncomfortable about the amount of personal information available. Banks employ so many people in customer data accessible roles that if only half of one percent of them are open to fraud or corruption, or just prone to loose talk and breach of customer confidentiality, the risk to personal account security is ever present.

Overall I have a lot of trust in my current account provider but the closer it gets to me through outreach contact the more cautious and concerned I would become.

As I mentioned previously, I am not against setting up a bank, or services within a bank, for those who need more guidance and support in their banking. I certainly support providing a basic account facility for every citizen since, as you say Vynor, there is no alternative – nearly all regular income is now paid by inter-bank transfers and almost every other form of payment needs to be banked before it can be drawn against. Equally, everybody has to set up some sort of regular bill payment process just to keep a roof over their head and meet their other consumer liabilities like phone contracts, line rentals and subscription charges.

The question is how much such services should cost and how they should be paid for. Personally, I would have no problem with there being a small levy on bank profits [or mutual current account providers’ surpluses] in order to fund such services and to prevent the direct costs becoming an impossible burden on the users. Not everyone would be happy with that but sometimes society does need to act collectively to prevent people sliding down a slippery slope into the lair of exploiters and extortionists, despair and ultimate ruin followed by mental and physical breakdown which would cost the country dear. Avoiding that is worth a common contribution. No one should be turned away from such a service but it would not be a commercial operation; it would have to include possibly an intrusive degree of customer support and intervention, and I think it should not be entirely free of charge to the user. Obviously only a limited range of services would be available and I would expect such an account to be administered in person, not remotely, and on a passbook basis; this would be primarily for the customer’s protection. It might require staff with special training and skills to be able to provide this service effectively and I can imagine it would not be without various difficulties and concerns. I would hope the welfare and consumer organisations who are quick to criticise banks for their impersonal and costly services would play a major role in establishing such personal account services.

Profile photo of duncan lucas
Guest

Sorry Vynor I agree with John –banks a “social service “” -OMG ! never in this universe , I dont just have the lowdown on banks but I have every dirty detail on the world banks that control the whole of the West who owns it , what they do , how the people owning them start wars , change political leaders, run the UK/ EU/USA . I have the names of them all and the ones at the top are trillionaires , I know , who runs and owns the Federal Reserve / the BoE and every bank in the west -a small group of people in terms of world countries , its a trail of dirt, corruption, greed, power , even the Donald is scared of them . Show reverence to them ?-for what they have done to the people of this world I show one thing —-the “finger ” . I care not if I am condemned I speak for the poor-sick-old not for the “Puppet Masters ” .

Profile photo of wavechange
Guest

John – I have never paid a penny for normal banking services and when interest rates are high, the bank will be able to make money from the credit balance in the account. In times of very low interest, that’s not going to happen and we have been told that high interest charges paid by customers in debt is lucrative for the banks. I believe it unethical.

Profile photo of malcolm r
Guest

We have debated at length as to how customers who get into debt without making an arrangement with their bank should be treated. Since arranging an overdraft – if you are a suitable candidate – is straightforward and “ethical” then I believe that is what we should be promoting. If you cannot reliably repay your bank then you need to look fundamentally at your finances; the bank is not there to subsidise you from other account holders money.

I think John makes a lot of sensible points. The vast majority (I believe) use their accounts properly and understand what they are doing. A “simple” account, with basic facilities and personal help, for those who are less capable is a good ideas.

Education of customers to set up and use their accounts, for those who need it, is something we should address. The BBA, banks themselves, and Which? could work together to produce a booklet and online material to do this.

We could also return to being critical of “pay day” loan companies that charge extortionate amounts to those in immediate need.

Profile photo of John Ward
Guest

I remember a time when my bank account carried a monthly service charge according to activity [withdrawals, cheques cleared, standing orders paid, etc]. I would be quite happy to go back to that if it stopped this continuing gripe about possible cross-subsidisation. If every account was run on its own cost basis according to a scale of charges [which would be transparent for competition purposes] many people might be both surprised and dismayed at the outcome. There is enough overnight money in current accounts to keep the banks in clover even at 1%. They don’t reveal the necessary liquidity ratio to meet normal requirements but I am sure it is adequate and well within their capacity. The excess is placed on longer-term lending.

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Guest

Interesting stuff, Duncan. I wish you would share some of it if it is true and if it actually affects the way we bank in the UK.

We are dealing here with UK banks and other current account providers like the mutual building societies. Starting at the top, the Bank of England is owned by the government and nobody else. The major retail banks [Barclays, Lloyds, HSBC, etc] are owned by their shareholders and their shares are freely traded on open markets so anyone can buy them. They are bought for investment purposes, not for running the bank. Mutuals are owned by their members and each member has one vote so no individual can dominate.

I am fairly indifferent as to who owns the banks because the owners do not run them. The CEO and executive directors run the banks and my concerns are in respect of their competence and that of the management and staff at every level. So long as each bank is governed and operated in accordance with the Banking Acts and other applicable legislation, complies with the guidance and directions of the Bank of England and its Prudential Regulation Authority, and is conducted to the satisfaction of the Financial Conduct Authority, that is all we can ask. The actual ownership is irrelevant and any dirty dealings that might be alleged carry no weight in this context. The directors of banks have to be approved by the Bank of England.

You can be sure that if banks operated in the manner of a social service the people you condemn would be nowhere to be seen because they are just there for the investment returns and your fears would therefore be allayed.

People who do not like using a commercial bank with dubious ownership can always use a mutual building society that provides a current account service. These have become very few as a result of de-mutualisation, amalgamations, and the decision of those like the Yorkshire BS to cease operating current accounts. They did that in response to demands from the BoE to make capital reserve provisions that were considered disproportionate to the risks of the kind of business they conducted. The change of status of the Co-operative Bank means that it is also no longer a mutual institution. Nevertheless there are still 44 mutual building societies although only two [Nationwide and Cumberland provide current accounts].

Other money services are available from some friendly societies and credit unions. The Post Office no longer operates direct retail banking but provides simple transaction services on behalf of a number of other banks. A number of major retailers provide banking services structured on commercial banks including paying-in, withdrawal and payment facilities. These offer a mechanism for managing personal finance at one step removed from a high street bank.

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Well I have found the relevant details John and the “family ” that own and control it and many 100,s of banks worldwide cannot be posted as I would be jailed , we are not talking about figureheads/CEO,s etc we are talking actual owners. Power talks also corrupts. But lets talk about the Federal Reserve as America doesn’t have absolute control of the UK —yet. .Virtually unknown to the general public (USA) is the fact that the US Federal Reserve /IRS is a privately owned company , sitting on its very own patch of land , IMMUNE to US law ( remind you of a certain part of London ? ) ,the IRS is a foreign private corporation of the —IMF ( and who owns the IMF ) and is the “private army ” of the Federal Reserve . There are TWO Megabanks that offer loans to countries round the world -the WB and the IMF , the WB is owned mostly (largest share owners ) by the said “family ” and the IMF totally owned by the said “family” most Americans dont know this . I now have a funny feeling that I should not have posted this as people in this country have “come to an end ” for being outspoken but what have I got to lose ? I dont value my life only my soul. I have intentionally left a lot out . Is there anybody well known in the City going to say I am not telling the Truth?

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I am in no position to tell whether or not what you are saying is the truth, Duncan, but I find it incredibly hard to believe without a shred of evidence to support it.

I can understand that the Federal Reserve has its own complex structure in order to guarantee its independence within the government of the USA but to say it is privately-owned is wrong. There are privately-owned elements within the Federal Reserve System but they are not personal holdings, cannot be traded, represent only a tiny minority of the capital, and do not qualify as ownership. The Federal Reserve was set up by the US Congress and remains an inalienable part of the American federal government. It owns its own property free of all encumbrances in order to guarantee its integrity and freedom from external interference.

The Internal Revenue Service [IRS] is not connected to the Federal Reserve System and is a department of the federal government responsible for collecting the taxes levied by Congress. Its equivalent in the UK is Her Majesty’s Revenue & Customs [HMRC]. There is no private ownership or control involved. The IRS is not a part of the International Monetary Fund and it has no monetary responsibilities.

I don’t know much about the World Bank and the IMF – perhaps I should because they occasionally impinge on the UK’s fiscal policy – but I believe they are subsidiary organisations of the United Nations established under international treaties and again without any private beneficial ownership.

I expect this is all documented somewhere for you to check but I don’t suppose you would believe it as it contradicts your assertions. Until somebody demonstrates otherwise I shall continue to believe what I have been taught and have studied. As I said previously this has no affect on the day-to-day conduct of the UK’s retail banking.

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The reason why you cant find evidence to support it is because the owners have removed their name and installed others to operate it but they still own it . I have the full Federal list from its start to now listing those installed as figureheads , I also have the full history of the BoE including all the names up till now how they operate etc . I am not asking you to believe me John as I said I want somebody at the top in the City to deny it . Your right I have no intention of changing my mind from what I know is the truth , there have been several posts by me where I have not been believed but as time passed I was proved right–time will tell John . Call me obsessive but once I know I am right I will go to the ends of the earth to prove it. The most recent one was when I said the Donald is going to insist the western world uses US fuel and those countries resisting could be sanctioned –guess what I have two emails from the White-House announcing he is doing just that, no embarrassment, no shame he is trying to force Merkel to give up North Stream 2 with the threat of sanctions but German Industrialists are against him as Germany is making a lot of money from Russia and , if implemented will make $$$billions out of it as a EU hub. He wants Germany , and the world to buy much dearer fuel from him and you know what I admire his honesty , he is for the USA and **** everybody else and he is reviving the US coal industry and will sell it to the Ukraine a coal-rich country. you cant say he has not got the US,s best interests at heart , its just the craven attitude of others in caving in I dont like.

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It’s certainly true that the WB has a lot of detractors and that the lines of ownership and control are notoriously difficult to determine. But you can certainly post a link to the appropriate source of your information, Duncan; I doubt they’ll send the boys round for that, but you’ve said you don;t care, anyway, so what have you got to lose? Throw caution to the wind, young man 🙂

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You’re asking a lot Ian considering what happened to me a number of years ago . Four times taken off the internet ,twice keyboard blocked/ mouse blocked , every time Windows programme scrambled , it took BT a good while to “investigate ” when they removed me from the web, thats known as “brute force ” not very subtle or intelligent they have “wised up ” a bit since then . You may not know it as we are in a war censorship situation as regards what is going on just now but we are about to be dragged into a battle for commercial control of the world , the US insisting it will not allow Russia to be a competitor , so its war(to end all previous wars ) for money, nobody is invading the US/UK/France/Germany etc . From the top -WB/IMF/ US conglomerates / US big business / a lot of this is controlled from the City and many Americans arent happy about it.

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Well, putting aside the fact that everything that happened to you has happened to me and I’m pretty sure it wasn’t the dark forces of the underworld in my case but good old fashioned incompetence on the part of BT and a local farmer that caused it, could you not take the chance? I promise I’ll station an angel on your guttering for a few days.

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Plenty of critical information about the World Bank and the IMF here:

http://www.brettonwoodsproject.org/2005/08/art-320869/

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I think most of those concerns and criticisms have been open knowledge for years and the UK certainly had its fair share of IMF interference and strait-jacketing during economic crises under previous governments. What the article does not comment on is the allegation that Duncan has picked up that the World Bank and the International Monetary Fund are owned and controlled to the world’s detriment by an unknown “family”.

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I don’t believe it is, frankly. And unless we have objective evidence that it is, I think we’re safe in assuming it ain’t.

Guest
Peter Da Costa says:
30 June 2017

malcolm r said:
It may be good advice that if you are not happy with the security of online banking, and don’t feel comfortable doing it, then don’t. Use your branch or, if you don’t have one locally, use the post office who offer banking services for many banks.

This assumes that there is a local post office that does this kind of business.

Guest
Donna Lambourn says:
30 June 2017

I used to get my business Bank statements from the branch and when Barclays changed to paperless accounts we were not made aware of this directly so i now have to print off my statements online. On Mon i was made aware that my BT hub had been hacked into which meant that everything i did on my mobile phone was jepordised and then on Tues i got a text message from Barclays saying that my Amazon account had a suspicious transaction… this actually turned out to be from a scammer so when i called the number given which was so close to an actual Barclays phone number i wasn’t concerned. I became concerned the next day when the scammer tried to set up a Direct debit for £49,000 so i called Barclays direct to investigate which is when this all came to light. Luckily the scammer set the false transaction on an overdrawn account so i didn’t lose money. My main gripe is that i went through phone security as i would with Barclays before talking to the scammer direct. When i said i was going to report this to the police, the scammer said that the bank would deal with it as all fraudulent transactions are reported by the banks direct to the National Crime Agency. So when i found out that all the previous 24 hrs contact with a scammer, i assured Barclays that i was going to report all this to my local police who advised me to contact Action Fraud. These people couldn’t have been nicer but my bug bare is that when i asked Barclays as to how can i tell when are text messages from Barclays are real, the Fraud advisor replied “well call the phone number on the back of your card and chat to us”… so what is the point of signing up for mobile messages if these are being hacked and the customer has to do the checking on behalf of the bank. Is it just me or were things better and more secure before everything went digital???

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A nasty experience Donna. The digital age has brought with it the digital crook. When there is evidence that these felons are being caught and punished we can settle back and enjoy the obvious advantages of home banking on line. Sadly they are winning the fraud battle at present and people like yourself are getting robbed. There are safeguards and rules to follow that make home banking more secure and many have no problem with their financial transactions. It is human to make mistakes, and when money is concerned, life savings can disappear in an instant if something is done in error or ignorance. The consequences of this are massively more than when making mistakes in some other areas of life, especially so as they may not be able to be corrected. That is why this banking business is so important to get right for everyone. It is also why the plausible fraudster makes human error more likely. There are certain rules that everyone should know about when dealing with electricity. These are important. There should be an equally transparent and obvious set of rules for on line banking. Lots of people have tips to offer, but a big publicity drive in the media would help put those tips into every home. Then, it might be a case of “did you follow the guidelines, and if not, why not?”

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Donna you actually raise a serious point in that using your Wi-Fi via your HH (home hub -BT) which was hacked your calls were being diverted this is well known to me and many technical help websites , so I raise the Question -why when you put this to Action Fraud they did not advise you ?? . Secondly why didn’t they tell you right away – CHANGE your router/modem PASSWORD ?? that is security step number one , if you dont do that you might as well bin your router . BT and most other routers have well know DEFAULT passwords ( to hackers ) there is even a list for sale on the web (dark web ) If you want I can talk you through changing it , if you dont have the tech or a friend to do it for you . I have posted on this issue that when it is passed to Action Fraud after a week it goes to the Serious Fraud/ Crime Dept , by that time the hackers have long covered their traces and yes I have the full details on how they avoid detection. On the other hand , in the USA you are given phone numbers which put a Fraud Alert on your credit files on the USA,s three biggest credit companies . As well as that they report it to the FTC a government investigation body in the USA which has CONTROL in its actions to force action from the USA,s biggest government investigation organisations . At least one poster on Which was the victim of Identity Fraud , in the USA this is a Federal Crime involving not only the FTC but the FBI AND the CIA , many get caught by the combined efforts of those organisations but its down to money and resources but those caught , because it is Federal get 15/20 year sentences . It is also very possible that malware isnow on your computer , if you need any help with removing files just ask , many of those files are hidden and in Windows you need authority to access them . A programme I found useful when I had Windows was called -EVERYTHING do NOT download it from Cnet/Download.com . this programme lists nearly a full list of files on your computer , you input a file name at the top or a programme etc and it will show you if it is installed or you can scroll down.

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As a banker for many years perhaps I can clear up some points made.

With my French account they instantly check when I set-up a payment that the name and sort code and account number agree. That they ALL agree. So I make a transcription error then it is picked up.

I deduce that the first step therefore checks account number to sort number. Then it goes to query the account holder name matches the other details. This involves a two day delay on a first payment.

So it works absolutely fine. Could the UK adopt it. Of course they could but no doubt they will have a consumer body demanding instant electronic transfers ….. do we remember that?

“Speed kills” …. and given humans being human are gullible, forgetful, and lazy I remain convinced that we are not at all well served by spending electronic money quickly in a variety of ways.

There is also – without a doubt – serious questions as to the security of so much of the electronics on which we are being asked and edged to rely on. Even major Banks are being taken for a ride as readers to the Register know.

We also have a burgeoning market in the sale of information to facilitate fraud. A sensible friend was duped by the BT scam and they almost got away with £2000. He was duped by the caller having all the details about his telephone account to establish his credentials and installed a program on his computer to deal with the “up-grade” to fibre that really was coming to the village.

The key part though was my sensible friend indulged in on-line banking and there was sufficient information on his computer for the thief to attempt a fraud. If there were a two day delay the chances of the frauds being successful would diminish greatly.

The other aspect is the Banks allowing accounts to be opened which are poorly researched and are paper ticking exercises. In my day I could and did refuse to open accounts where I was not satisified with the story provided .

I suspect that staff are incentivised to open accounts not to be intelligent about the value of them. And not much reported are staff that have been turned and actually assist in targeting customers for fraud and opening accounts. Perhaps this aspect needs to be highlighted and an Inspectorate of Bank security set-up to report on bank staff , and branches with many dubious accounts.

There is an awful lot of data available of use for those prepared to look and be prepared to pursue energetically.

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There are, to me, two basic issues to consider.
First, minimising scams. We should make all reasonable efforts to prevent scams from being successful; this means by us as individuals using knowledge and common sense, and banks improving their systems to keep pace with, or outpace, scammers techniques.
Second, how we consider compensation for victims. We need to assess their own part in succumbing to the scam, and the banks’ negligence, if any, in not making sensible precautions. However we should then rephrase the compensation question from “should banks compensate victims” to “should we compensate victims”. The money used as compensation will ultimately come from banks customers in the form of additional charges or reduced returns. Ah, but why not penalise the shareholders? Because most shareholders ultimately represent us in the form of pension funds for example, so we will still pay (reduced returns).

Perhaps if we realised that all of us will contribute towards compensation, we might focus more closely on where all or part of the fault can be ascribed and how deserved that compensation really is.

I note from the Microsoft scam that someone who was duped was paid back by their bank. You might ask, given the publicity to such scams, why the individual concerned fell for the scam and whether they were not wholly or partly to blame. Just where does individual responsibility cease (putting emotion to one side)?

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We have just set up a new joint current account with the sole purpose of paying companies who either don’t take credit cards or who levy charges for using them. Why? you might ask.

We have had several large purchases recently where the companies levy up to 3% for using a credit card and one that didn’t even take them, so took our business elsewhere.

For a start, I think it should be illegal to add credit card charges and companies should allow for their use in their pricing structures and the price you see should be the price you pay. Which? campaign?

Companies should not be asking for bank details and giving debit card details to an unknown company is just asking for big trouble.

So we have set up a new account with First Direct with no overdraft facility that will stay empty unless we need to make a payment by debit card after paying a deposit by credit card for peace of mind. We have other accounts meeting the criteria for not paying charges on it, so hopefully our normal current accounts will stay safe.

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Alfa I am in the process of setting up a separate account specifically for using on the internet for the first time as I dont want my main account hacked with a key-logger. My wife although stuck in the one chair unable to move sees things for sale on the TV and its her one entertainment value and who am I too deny that ? As well most big supermarkets wont deliver to country locations unless its done via the internet so I am biting the bullet but limiting my risks by only putting a small amount in the account .

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I had a Nationwide credit card account which I used for just such purposes – to use for occasional expenditure to avoid the possibility of access to my current account and primary credit card account. I didn’t use it very much and it had a small credit balance but Nationwide has now said it will close it unless I use it within a couple of months. I am transferring the credit balance to my current account and shall let the credit card lapse. I didn’t apply for it – it came with an account I once had but it had its occasional uses.

We both also have card-based accounts with an independent department store in Norwich which gave good-value vouchers in return for expenditure. We used this for every purchase in the store for convenience and because the pay-back period could be up to two months without interest. Unfortunately the store has now informed us that it is closing its personal accounts because of onerous regulations, the cost of administration, the decline in the number of customers using it, and the almost total reliance on commercial credit and debit cards nowadays. I understand the decision but I shall miss the facility. It encouraged us to buy things in the store supporting local trade and jobs and I might be less inclined to go there now [although it does have excellent departments – including, those high street rarities, furniture, carpets, books, and stationery]. In future I shall have to use the John Lewis Partnership Card which has similar features but the voucher rate is lower when used for purchases outside JLP/Waitrose.

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John-I passed by my village petrol station today which closed down years ago , which has had some plant installation works carried out in the past weeks and voila ! there was a couple of swish futuristic looking pumps on display . Being naturally curious -aka -nosy I slammed on my brakes walked over and inspected them , I was then approached by a young (to me ) lady with a clipboard in hand and I said -how do they work , can I input cash — uh no ! was the reply , they are for the modern technological age and only work with card+pin (not my cup of tea as it leaves you open to all sorts of bugs+trackers/third party involvement ) . I then asked -is the garage shop going to reopen -uh no ! this is a modern UNMANNED petrol station , so I looked at her and said –and I bet you are doing a customer check on its feasibility to exist (profit ) – — yes . I personally will still travel to the nearest town 10 miles away, she was very pleasant to talk to though , outgoing personality.

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I recently encountered an unmanned petrol station next to a Tesco filling station. I wonder if anyone has done a risk assessment, and I’m not referring to financial scams.

I recall when the local Tesco filling station would accept credit card payment without the use of a PIN. Just ‘borrow’ someone’s credit card and fill up. This lasted years before common sense ensued and machines that required a PIN were installed. I wish that those who bang on about the public behaving responsibly would devote the same energy towards getting the business world to do the same.

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I haven’t come across an unattended filling station yet, but I can understand the attractions to the petrol companies as it cuts out all sorts of risks. But it also introduces new ones and without knowing more I am rather worried about the safety implications. Petrol vapour is highly volatile and many people do not treat it with respect – smoking, not switching-off or actually using mobile phones, and being careless with the filling hose. Perhaps it is monitored remotely by CCTV, perhaps there are alarm buttons at every pump, and perhaps there is a daily maintenance check by a patrolling inspector. It would be useful to know more. I hope the fuel delivery drivers are also able to deal with any problems that crop up during their time on site because they would be the first point to look to for help.

We have lost so many rural filling stations over recent years that this is a welcome development if it operates safely and reduces crime, This will not be a good move for disabled drivers who need assistance, however.

The big question is will it still be possible to buy a bottle of pop and a bag of crunchy crisps? – From a machine I suppose. And what about the last minute flowers, the Sunday papers, and the BBQ supplies?

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We use an unmanned petrol station regularly. This one is fitted with cameras, which are presumably monitored from a central location, but there are no attendants. Bit like Hospitals in North Wales, where they’re having to close wards because they can’t get staff.

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A lot of local Councillors are angry at the closures of community hospitals in Wales due to “budget cuts ” which wont pay for staff increases and those nurses left are overworked and end up ,leaving as well . Meanwhile in Scotland who now have control over this and have ,for several years, increased the spending ABOVE the Barnett consequentials received from health consequentials in England and yes Ian no “conspiracy theory ” taken straight from – news.gov.scotland for 2015. Priorities money or life ? Its not the rich who can afford private care that depart for the next life its the poor.

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Happy to continue this in the Lobby, Duncan.

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Ian I have never in my life “hidden ” behind closed doors , crept into “Lobbies ” , met in secret , etc , while I can keep a secret if I thought it was in the national interest or I was being loyal to somebody or organisation I much prefer the public at large to NOT be kept in the dark like it is being by the national media just now ( “not in the public interest ” ) –your joking !! My whole constitution rails against secrecy as it has caused me permanent bad health and when in later life you find you have been constantly lied to by so called friends well I disavowed them even my own relatives .I would rather live in exile with a few trusted friends than a 1000 back-stabbers /smile at your face while thinking how to cause you harm. As at least one regular has said on Which-trust has to be earned and that is my motto too. I take it you disagree with what I posted ? I got all the facts from local Welsh newspapers/local Councillors– in Scotland’s case straight from scotland.gov official figures issued by the Scottish parliament as that is a major issue in Scotland and they hold the opposite view to England -no more privatisation to the NHS , yes it will cost the Scottish tax payers and yes HMG has reduced the Scottish grant due to “austerity ” -aka- pay the IMF/WB and who owns that ? so the First Minister is up against criticism that even more must be pumped into the NHS (Scotland ) yet the same pressure doesn’t seem to apply in England–political games being held there not “Highland Games ” . 90 % of the media in Scotland is anti-SNP owned by English companies yet they go against a majority that TM would love to have .

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Unmanned filling stations on supermarket sites have been around for many years now. For example, Adsa have one at their Pilsworth hypermarket near Bury, Greater Manchester and Tesco have one at their store in Porthmadog, North Wales.

Given the provisions of the Health and Safety at Work etc Act 1974, it is a legal requirement for all of these facilities (and manned stations too) to have “suitable and sufficient” risk assessments.

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There is nothing secret bout the discussions that take place in The Lobby, Duncan. Anyone can read them and anyone can join in. It’s for keeping off-topic debates out of mainstream Conversations where the intrusion of controversial correspondence can put off potential contributors.

This particular Conversation is about banking scams and fraud, not about the funding of hospitals. We were already in a minor digression about unstaffed filling stations [using contactless payment] in response to a relevant discussion about the use of separate accounts as a protection and damage limitation plan against hacking. Ian made a humorous aside about unattended hospital wards and then off we went again into a political diatribe about Welsh councillors, the Scottish experience, the Barnett formula, and privatisation of the NHS. By no stretch of the imagination is this anything to do with bank transfer scams so it is right and proper that if people want to continue they should do so in The Lobby Conversation, which was created for that very purpose. I am sorry if you do not like posting your extra-mural comments in The Lobby but I can appreciate how clogging up single-subject Conversations with irrelevant polemic can deter people from participating. There is now a place for such discussions and it’s entirely up to you whether or not you use it.

I have noticed significant changes in the nature of Which? Coversation in recent months and a distinct fall-off in contributions from both ‘regulars’ and newcomers. I have my own theories on why this should be and accept my share of responsibility for the occasional Conversational digression and for weighing in with corrections when the facts have been misrepresented. But if people don’t like the tone of the Conversation or don’t find the discussion conducive to their involvement they will not take part. Some have actually hinted at their dislike of certain trends and are now rarely seen. We all have something else we should probably rather do.

I think any continuation of this issue should take place in The Lobby.