Safety net for bank scam victims is extended

A safety net which gives blameless bank transfer scam victims greater protection has been extended until the end of the year.

UK Finance, which represents banks and building societies, said the current arrangements for paying compensation to victims of authorised push payment (APP) scams will be extended to December 31.

This will allow more time for regulators, Government and industry to come up with a long-term sustainable funding arrangement.

The voluntary code was launched on May last year to make it easier for fraud victims who are tricked into transferring money to criminals to get their money back in "no blame" situations where neither they, or the bank did anything wrong.

The interim safety net – funded by the banks – was due to run out at the end of March.

Consumers collectively lost £208m to APP scams in the first half of 2019, as a result of being tricked into authorising cash to accounts controlled by criminals.

Often, criminals will pretend to be a bank official, a business or the police to trick victims into transferring money.

Stephen Jones, chief executive of UK Finance, said: "The banking and payments industry is committed to defending their customers.

"The voluntary code has set stronger standards to help protect customers but there is a responsibility on all industries, not just banking, to do more to stop these criminals from being able to target customers.

“Issues of liability and reimbursement should best be addressed by new laws rather than a voluntary code alone."