Banks that let fraud­sters open ac­counts won’t re­fund us

The Daily Telegraph - Your Money - - FRONT PAGE -

The num­ber of ac­counts taken over by crim­i­nals has risen but vic­tims are still de­nied com­pen­sa­tion, says Amelia Murray

Banks that al­low crim­i­nals to open or take over ac­counts are re­fus­ing to com­pen­sate vic­tims of fraud, even as of­fi­cial fig­ures show a rise in scams. Tele­graph Money has been cam­paign­ing for banks to take more re­spon­si­bil­ity when vet­ting ac­count open­ings and com­pen­sat­ing vic­tims of scams if their ac­count ver­i­fi­ca­tion pro­cesses fail.

No data ex­ists on how many crim­i­nal ac­counts are opened but fig­ures from Ci­fas, the fraud preven­tion agency, show that the prob­lem of “money mules”, where peo­ple let fraud­sters use their ac­counts to store and trans­fer stolen funds, is grow­ing.

There were 24,798 “mis­use of bank ac­count” cases be­tween Jan­uary and Septem­ber this year, a 50pc rise on last year. In­ci­dences of young peo­ple be­ing “money mules” saw a 75pc in­crease com­pared with the year be­fore and twice the num­ber four years ago. Ex­perts say banks should be do­ing much more to pre­vent th­ese crimes.

Re­tired po­lice of­fi­cer Les­ley Glad­stone trans­ferred £3,695 to an eBay seller, who turned out to be fake, for a Toy­ota Land Cruiser that never ar­rived.

Ms Glad­stone, 55, made the pay­ment to a TSB bank ac­count on March 24 this year af­ter speak­ing to the fraud­ster on the phone. The seller said he was out of the coun­try and was sell­ing his late brother’s car.

Fraud­sters on eBay will of­fer many ex­cuses as to why the ve­hi­cle can­not be viewed, while gen­uine sell­ers will gen­er­ally ar­range for some­one to act on their be­half.

Ms Glad­stone said that days af­ter trans­fer­ring the money she be­came sus­pi­cious when she read about a sim­i­lar scam on­line.

She said she felt “an­gry and stupid”, hav­ing bought hun­dreds of items on eBay be­fore. How­ever, she said she was go­ing through a “trau­matic time”, as her son-in­law was re­cov­er­ing from a se­ri­ous in­jury fol­low­ing an ac­ci­dent and her daugh­ter was un­well with stress.

When the ve­hi­cle failed to show up, Ms Glad­stone’s hus­band called their bank, RBS. Action Fraud, the UK’s cy­ber­crime re­port­ing ser­vice, was also alerted. The case was passed to the Metropoli­tan Po­lice, which dis­cov­ered the fraud­sters had used mul­ti­ple ac­counts that had been opened with fraud­u­lent iden­tity cards and false de­tails.

In another case, Keith Faulkner, who fell vic­tim to an on­line ro­mance scam, also dis­cov­ered he had trans­ferred money to a fraud­ster’s bank ac­count that was opened us­ing bo­gus in­for­ma­tion – this time with Lloyds.

Mr Faulkner, 72, be­gan talk­ing to an “at­trac­tive Amer­i­can woman in her 40s” on a dat­ing web­site in 2013.

Af­ter chat­ting for some months, the per­son told him they had “sev­eral mil­lion dol­lars” held in Am­s­ter­dam that would cost £35,000 to re­lease. They said they had in­her­ited the money af­ter the sale of land in Nige­ria.

Mr Faulkner, from Bas­ingstoke, did not have the full amount, but agreed to trans­fer £30,000 to the crim­i­nal’s Bar­clays ac­count in July 2013.

Bar­clays flagged the pay­ment as sus­pi­cious when the fraud­ster im­me­di­ately with­drew £17,000. It could not re­coup th­ese funds but trans­ferred the re­main­ing £13,050 back to Mr Faulkner.

Mr Faulkner, whose wife died 15 years ago when his son was 12, ad­mit­ted he was “emo­tion­ally in­volved” with the fraud­ster and con­tin­ued to be in con­tact.

“They draw you in and your emo­tions take over, es­pe­cially if you’re on your own,” he said.

Months later, he was per­suaded to trans­fer the re­main­ing £13,050 to a Lloyds ac­count he be­lieved be­longed to a “mid­dle­man” who would help re­lease the funds.

A re­cent po­lice investigation re­vealed that th­ese ac­counts had been opened us­ing just a pro­vi­sional driv­ing li­cence and that the sus­pect did not live at the given ad­dress.

Neil Hare Brown, the founder of Storm Guid­ance, which ad­vises busi­nesses on cy­ber risks, said it was easy for fraud­sters to open ac­counts in the UK.

He said: “Banks have a look at the doc­u­ments, tick the box and that’s it.

“It’s not good enough. What’s the

‘Banks must do more to pro­tect peo­ple from los­ing life-chang­ing amounts of money’

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