How Is Your Bank Protecting You Against Authorised Push Payment Scams?

A hackers screen showing a push payment scam

We all know someone who has fallen victim to some sort of scam – or maybe even been a victim ourselves but with scammers becoming more and more sophisticated in their methods, what are the banks doing to protect and reimburse us when it comes to these crooks getting their hands on our money?

From the end of May major banks, including Barclays, Royal Bank of Scotland, and Lloyds Banking Group will be offering more protection to those customers who have been tricked into transferring money to fraudsters.

The voluntary code of practice, which will come into force on May 28th of this year is designed to ensure that victims are reimbursed for any money they’ve lost due to authorised push payment scams (APP).

So what exactly is an APP scam?

What Is An Authorised Push Payment Scam?

In simple terms a Push Payment Scams is when you are tricked into transferring hard-earned cash from your own account into the account of a scummy scammer! This money is then very quickly transferred to other accounts, normally abroad, and then withdrawn by the criminals.

In the first half of 2018 alone it is estimated that customers lost over £92 million to these Push Payment Scams.

And What Have Banks Been Doing About This Up Until Now?

Well normally if payments are made without a customer’s authorisation their bank will give a refund, BUT, they are not legally obliged to if the customer has been tricked into making that payment themselves, ie: in the case of an authorised push payment.

But That’s About To Change?

In a word, yes. Banks that have signed up to the code of practice will now have 15 working days from the Push Payment Scam being reported to decide whether or not to refund the victim. In “exceptional cases” this can be extended to a maximum of 35 working days, and the refund will be made as soon as possible.

Are There Exceptions?

Yes. This new code of practice states that the customer won’t be reimbursed if they have:

  • Ignored their banks warnings about such Push Payment Scams
  • Been grossly negligent in transferring the money

And How Does The Code Ensure That Doesn’t Happen?

The code states that banks must try and identify those customers who might be more vulnerable to a money transfer scam, and that if such a Push Payment Scam is spotted they must warn them.

While the bank investigates the scam it should delay the payment, and the bank who is set to receive the payment should freeze accounts if it thinks the funds coming in are from an APP scam. 

From May 28th banks will need to implement the Confirmation of Payee service. This checks whether the name attached to a payment matches with the account number and sort code. If it doesn’t, the bank can warn the customer that it looks as if they are about to send money to the wrong account.

However, when it comes to the COP service, the code doesn’t give a deadline for this coming into force, and UK Finance who represents the banks have said this might be delayed until next year.

It’s reassuring to know that there are measures being put in place by the banks to protect us against these scams, including educating their customers and providing aftercare to those who have been victims. But what can we do to protect ourselves?

How To Avoid Push Payment Scams In The First Place

Ideally we’d all spot the signs of a Push Payment Scams before we handed our cash over, but today’s scammers certainly don’t make that easy! Some advice that might help is:

  • Don’t be drawn in by the fact that someone knows your personal details such as your name and address – or even your mother’s maiden name. This doesn’t mean they are genuine, just that they are sneaky af.
  • Trusted organisations such as your bank or the police will never contact you and ask for your PIN or any passwords. Nor will they ask you to transfer money to a ‘safe account’.  
  • Always be suspicious of unsolicited calls/emails asking you for personal information. Contact the company yourself using a trusted contact number or email and check that it is a genuine request.
  • If you receive an email or text that you weren’t expecting DON’T click on any links. Again, find trusted contact information for the organisation and check that what you’ve received is genuine.

If you think you’ve been the victim of a banking scam, or you think you’re being targeted report it immediately to your bank followed by a swift call to Action Fraud.

Action Fraud is the UK’s national reporting centre for fraud and cybercrime where you should report fraud if you have been scammed, defrauded or experienced cyber crime in England, Wales and Northern Ireland.

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