Karl Flinders, 19 May 2021
Which? has called on banks to be more transparent about the proportion of victims of authorised push payment (APP) fraud they refund.
Barclays has signed up to a code to do so and has revealed that 74% of customers who suffered losses because of APP fraud in the first two months of this year have been repaid.
APP fraud, also known as bank transfer fraud, occurs when a consumer pays for something which turns out to be fake, and a criminal steals their money. Banks often reimburse customers through the Contingent Reimbursement Model, introduced in May 2019. This sets out when victims who are manipulated into making real-time payments to fraudsters are to be reimbursed and by whom, and banks usually take responsibility.
While Barclays has signed up to a code to publish refund figures, Which? said other banks “remain tight-lipped” about them.
“This lack of transparency isn’t acceptable,” it said. The consumer rights organisation has contacted all major banks and building societies requesting they commit to publishing their reimbursement rates by 28 May. It said banks routinely blame scam victims.
“We believe all banks should publish figures on fraud refunds on a regular basis, rather than cherry-picking specific months. Greater transparency is needed as, in many cases, banks are blaming customers rather than reimbursing them.”
Banks have already signed up to a code to repay victims of APP fraud, but figures from the Lending Standards Board, which oversees the code, revealed that between May 2019, when the code was introduced, and July 2020, banks ruled that 77% of fraud victims were partially or fully to blame for their losses.