For the first time, banking firms have disclosed money transfer fraud reimbursement rates for claims. Here are the best and worst when it comes to victims getting their money back.
TSB recorded the highest value of money lost to Authorised Push Payment (APP fraud) in 2022.
For every £1m TSB customers sent from their accounts in 2022, £348 of that was lost to APP fraud.
For Santander customers it’s £322 per £1m lost to APP fraud, and for both Metro and Monzo customers, they lost £280. By comparison, for every £1m sent from customers of AIB Group, only £23 was lost to APP fraud.
APP fraud has been on the rise in recent years and occurs when people are tricked into transferring money to a seemingly legitimate account which is in fact controlled by a scammer. In 2022 losses to APP fraud reached £485.2m.
Based on transaction numbers across 14 of the biggest banks and ten smaller firms ranking highly as receivers of fraud, for every one million transactions made in 2022 by Monzo customers, 141 were reported as APP fraud.
However, Monzo customers were least likely to be reimbursed, figures from the Payment Systems Regulator (PSR) revealed.
It noted only 6% of cases reported to Monzo were fully reimbursed (by volume), while the challenger reimbursed 22% of APP fraud losses based on value.
Meanwhile TSB fully reimbursed 94% of the APP scam cases reported to it, followed by Nationwide which fully reimbursed 91% of cases and Barclays which fully reimbursed in 79% of cases.
When it comes to financial firms receiving fraudulent funds from APP scams, Metro Bank, Starling, TSB and Monzo topped the league.
The PSR revealed that for every £1m received into Metro Bank accounts in 2022, £696 of it was APP fraud. For TSB, the amount was £605, Starling was £307 while for Monzo the equivalent amount was £227.
By contrast, for every £1m received by Santander accounts, only £44 was from APP fraud.
Inconsistent outcomes for APP fraud victims
The figures come ahead of a compulsory refund scheme implemented by the regulator, but pushed back to October 2024. Under the new measures, both sending and receiving firms will be held equally liable for reimbursing victims of APP fraud in nearly all cases.
For now, firms have signed up to a voluntary scheme and while the PSR said it has “delivered some good outcomes and was an important first step in getting some of the banks to do more to tackle APP fraud, it has not led to consistent performance”.
The PSR said there are “currently inconsistent outcomes for customers who report an APP scam to their bank or building society”.
It said: “For example, some automatically reimburse in full, others may only make a partial reimbursement leaving victims to bear part of the loss, and others will only accept claims subject to very narrow circumstances.”
Once the new rules come into play, there will be greater transparency for customers as payment firms will be required to publish this information on their websites within 20 days.
Chris Hemsley, managing director of the PSR, said: “This is the first time we can see at an individual level how well banks and payment firms are dealing with APP fraud.
“This represents a substantial improvement in transparency. This provides better information for customers on how firms handle APP fraud and encourages these firms to take more action to tackle it.
“Over the coming months, we will be bringing all payment firms into new reimbursement arrangements to give more consistent protection across the board. This is important because we can see from today’s report that this has not always been the case.”
