No agreement on reimbursing cash transfer fraud victims

Britain’s banking industry cannot agree how a scheme to refund blameless victims of money transfers should be funded, says the UK’s payment scheme operator.

Pay.UK said there was “no industry consensus” on the financing of a central fund to reimburse innocent victims of authorised push payment (App) fraud.

App scams happen when someone is tricked into transferring money directly into a fraudster’s bank account, often because the criminal is posing as a legitimate organisation such as a bank, HM Revenue and Customs or the police.

Previously, scam victims who had done nothing wrong had no automatic right to get their money back from their bank – as they had authorised the transfer.

But a voluntary industry code introduced in May makes it easier for victims who have done nothing wrong to get their money back.

However, the long-term funding of the code still needs to be agreed.

Consumer group Which? said the next government should make the code and reimbursement mandatory to prevent innocent scam victims from losing life-changing amounts of money.