Banks reject more than half of scam refund claims

MORE than half of scam victims are still being refused refunds despite banks pledging to treat customers more fairly with the introduction of a repayment scheme last May.

Bank scam victims lost £101.1m between May 28, when a new code of conduct was brought in, and the end of December last year – around £500,000 a day.

Yet just £41.3m of this was reimbursed by banks, according to figures from banking trade body UK Finance.

The code of conduct is voluntary but nine major banks and building societies, including Barclays, HSBC, Lloyds, RBS and Santander, have signed up. It says banks should refund victims who took reasonable steps to protect themselves.

Total fraud recorded over the whole of 2019 has jumped significantly, with the number of ‘authorised push payment’ cases up 45pc to 122,437 compared to the year before.

This type of fraud is where criminals trick customers into handing over bank details or savings because they think they are talking to people such as the police or the taxman.

Other scams include victims giving money to bogus tradesman, unscrupulous online sellers or fake investment firms. The money lost also rose – by 29pc last year to £455.8m.

In the first half of the year, before the new refund scheme was introduced, 19pc of losses were refunded. This increased to 41pc, but left more than half of victims still out of pocket.

Cheque fraud losses were 152pc higher, at £53.6m, in 2019. Mobile banking fraud, where criminals access a bank account via customers’ smartphone app, jumped 94pc, to £15.2m. Gareth Shaw, head of money at Which?, said: ‘Many who have lost money are still not getting the protection they deserve. The code pledges to reimburse all blameless victims of fraud, so it’s vital all banks signed up to it are consistent and fair.’