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‘Super-complaint’ launched over banks’ treatment of fraud victims

Written by: Paloma Kubiak
A ‘super-complaint’ has been submitted to the financial regulators calling on them to ensure banks better protect consumers who are tricked into transferring money to a fraudster.

We now make over 70 million bank transfers, known as ‘push payments’ a month, compared with just over 100 million per year a decade ago, but campaign group Which? said the consumer protections “have not kept up”.

There are protections available for consumers who fall victim to direct debit, debit card and credit card fraud but currently, those conned into transferring money by bank transfer to a scammer have no legal right to get their money back.

As scams become ever-more sophisticated, consumers can’t be expected to detect complex scams pressuring them to transfer money and Which? said banks should shoulder more responsibility for money lost to tricksters in this way.

As a result, it’s submitted a ‘super-complaint’ – allowing certain bodies legal powers to complain when they’re concerned consumer interests are significantly harmed – to the Payment Systems Regulator (PSR) and the Financial Conduct Authority (FCA).

Which? is calling for the regulators to:

  • Formally investigate the scale of bank transfer fraud and how much it is costing consumers.
  • Take action and propose new measures and greater liability for banks to ensure consumers are better protected when they have been tricked into making a bank transfer.

Alex Neill, director of policy and campaigns at Which?, said: “We all now regularly use bank transfers to pay for things, but what most of us don’t realise is that if you’re conned into paying out money to a fraudster you stand to lose all of your money, unlike when you use your credit or debit card.

“With scams on the rise, consumers can only protect themselves so far and we believe that banks must do more to tackle bank transfer fraud and safeguard their customers from scams.”

The FCA and PSR now have 90 days to investigate and respond to the concerns raised by Which?.

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