Banks told to do more to warn over scams
Banks are being told to do more to provide effective warnings which could make customers think twice about sending money to fraudsters.
The Lending Standards Board (LSB) looked into how banks are interpreting a voluntary code which reimburses blameless victims of bank transfer fraud.
It says warnings as customers are in the process of making payments are a key tool banks can use to help prevent customers from being conned but they are not beingused uniformly.
The code sets out a commitment to reimburse victims of authorised push payment (APP) fraud – where neither the customer nor the bank is to blame for the transferring of money to a criminal.
The LSB said that in limited instances an absence of warnings resulted in breaches of the code and arbitrary thresholds resulted in transactions below certain amounts either not receiving a warning or only generic text.
More than £89m has been reimbursed to thousands of customers since the code was introduced.
Emma Lovell, chief executive of the LSB, said: "Overall, we found that firms had taken warnings as a serious tool but there is still work to be done to ensure all firms are displaying dynamic and targeted warnings which are effective in making a customer stop to carefully consider whether the payment should be made.
"We will monitor firms' progress in em bedding these recommendations and conduct a follow-up review later next year."
Katy Worobec, managing director of economic crime at UK Finance, said there is a lack of consistency and clarity around how banks should implement the code.