Watchdog files reveal how banks are letting down their customers

EXCLUSIVE Money Mail analysis of complaints made to the Financial Ombudsman over the past five years reveals that banks are often missing significant opportunities to stop customers losing money to fraudsters.

In the worst cases, the Ombudsman accused banks of ignoring fraud happening ‘under their noses’.

In others it found that banks have waited for as long as 12 days before chasing payments made to fraudsters.

Banks say they cannot refund victims of bank transfer fraud because they are just doing as the customers asked.

But the Financial Ombudsman says this cannot be used as a cover-all excuse to not compensate victims. So if your bank made a mistake or did not act promptly enough, you may be able to get your money back.

In one case seen by the Ombudsman, Santander waited 12 days to act on a fraud report.

The woman had been tricked into sending £14,600 to an overseas bank. Just two hours later, she called Santander to stop the payment. But the bank did not try to recall the payment for a further 12 days because it was ‘shortstaffed’. By this time her savings were gone. The Ombudsman ordered Santander to refund the victim and said it ‘knew — or ought to have known — the situation was time-critical’.

In another case Nationwide was accused of failing to stop a fraud ‘taking place under their noses’ when they allowed a woman to transfer £30,000 to a fraudster.

She had been told to tell branch staff she was transferring the money to her daughter but the Ombudsman said staff suspected she was the victim of a scam and could have done more to help.

To compensate the customer the building society had to refund her half of what she lost.

A spokeswoman for Nationwide says: ‘She advised us the payment was for her daughter . . . as the customer authorised the payment and was untruthful about the reason she wanted to send the money, the Society held her liable for the loss.’