Protecting Yourself Against Authorised Push Payment Fraud

Push Payment Fraud, More than Money

Push Payment fraud in the UK is becoming more common and scams are sophisticated in their methods. What are the banks doing to protect us?

It’s a sad fact that Authorised Push Payment Fraud is becoming more common in the UK, and scammers are (worryingly!) getting more sophisticated with their methods. 

But what exactly is APP Fraud, and how can we stop it from happening to us?

What Is Authorised Push Payment Fraud?

In a nutshell, Authorised Push Payment Fraud is when you are duped into transferring your hard-earned cash from your own account into the account of a scummy scammer! 

This money is then transferred very quickly to other accounts – normally abroad – and then withdrawn by the criminals. 

It can be a very slick operation, and often they’re sipping on a cocktail with a widescreen TV tucked under their arm before you’re even any the wiser. 

In the first half of 2020 alone, customers lost over £200 million to these types of scams according to TSB.

That’s a lot of TVs.

Who Can Be A Victim Of Authorised Push Payment Fraud?

Any one who has a bank account, basically.

We probably all know someone who has fallen victim to Authorised Push Payment Fraud – also known as APP Fraud/scam – or maybe even been scammed ourselves!

So, what are the banks doing to protect us, and will they reimburse us if we fall foul of Authorised Push Payment Fraud?

Push Payment Fraud, More than Money
Push Payment Fraud statistics according to TSB

What Is My Bank Doing About Authorised Push Payment Fraud?

Well, back in the day, not a lot.

Sure, they would refund payments that were made without your authorisation, BUT, they weren’t legally obligated to if you have been tricked into making the payment yourself. In other words, not in the case of Authorised Push Payment Fraud!

However, on May 28th 2020, a voluntary Code of Practice came into place to offer more protection to customers who have been tricked into transferring money to fraudsters. 

All of the big banks got on board, including Barclays, Royal Bank Of Scotland, and Lloyds Banking Group, and promised to reimburse any customers who lost their money because of Authorised Push Payment Fraud (APP)

This code of practice means that banks now have 15 working days from the date of the Push Payment Scam being reported to decide whether or not to issue a refund. 

In “exceptional cases” (we’re probably talking about money being taken from someone who is elderly or vulnerable), this time period can be extended to a maximum of 35 working days, and the refund will be made as soon as possible.

How Does The Fraud Code Of Practice Work?

The code of practice introduced in 2020 to protect customers from becoming victims of Authorised Push Payment Fraud, states that banks must try and identify those customers who might be more vulnerable to a money transfer scheme, and that they should warn them if they spot such a scam.

While the bank is investigating the scam it should delay the payment; and the bank that’s set to receive the payment should freeze accounts if it thinks the funds coming in are from an Authorised Push Payment scam. 

The code of practice requires that banks implement the Confirmation of Payee service to check whether the name attached to a payment matches with the account number and sort code. 

If it doesn’t, at least the bank can warn the customer that it looks as if they’re about to send money to the wrong account. 

Why Won’t My Bank Reimburse Me After a Push Payment Scam?

There are two reasons why your bank won’t reimburse you after you’ve fallen victim to Authorised Push Payment fraud:

  1. You ignored your bank’s warning about Push Payment Fraud
  2. You were grossly negligent in transferring the money

‘Grossly negligent’ is surely open to interpretation, but I’m guessing that if you’re blindly transferring cash to a company whose email address ends in ‘hahawegotyougood.com’, your bank won’t be clamouring to give you your money back.

It’s awesome, obviously, that banks have measures in place to protect us from Authorised Push Pay Payment 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 Payment Scams

In an ideal world scammers would all wear neon signs with flashing lights and be ringing a bell, but in reality, spotting the signs of Authorised Push Payment fraudsters isn’t anywhere near as easy!

4 Ways to avoid Authorised Push Payment Fraud are:

  1. 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 that they’re genuine, just that they’re sneaky af. 
  2. 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’. 
  3. 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. 
  4. 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 Authorised Push Payment Fraud, or you think you’re currently being targeted, report it immediately to your bank followed by a swift call to Action Fraud. 

Be sure to read our article, What To Do If You Think You’re Being Scammed for more tips on, well, what to do if you think you’re being scammed.

Action Fraud is the UK’s national reporting centre for fraud and cybercrime in England, Wales and Northern island. 

Andy

28 years is a long time to do anything and that’s how long I’ve been giving financial advice for! Everything you’ll ever need to know about Mortgages and Home Insurance can be found within the digital walls of this website. Fill your boots with as much knowledge as possible and if you have further questions or would like to get the ball rolling on buying your new home then I would love to help you! I promise to keep things as simple as they need to be and don’t worry about all the paperwork, me and my team can cover that!

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