Victim of a money transfer scam? You now have new rights with most banks - MSE News

Bank customers who are tricked into transferring cash to fraudsters now have more protection and are more likely to get a refund, after most major banks signed up to a new voluntary code...
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'Victim of a money transfer scam? You now have new rights with most banks'
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  • jonnygee2jonnygee2 Forumite
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    I still disagree with these changes.

    Although the stories are heartbreaking, the fact is that if mentally capable people instruct a bank to send their money somewhere, the banks job is just to move it. It's up to people to decide where to send their money and to check where their money is going.

    By letting the banks take responsibility for something that's clearly not their fault, it just diminishes the responsibility. It won't be long before people stop worrying if something might be fraud because 'the bank will cover it', in the same way people have generally stopped worrying about unauthorised transactions and security of card details etc.

    The solution is education and information campaigns for consumers, and much better controls at the receiving banks to stop people setting up the dummy accounts that these payments get sent to, or better detection methods so that money in them is frozen before its sent abroad.
  • Willing2LearnWilling2Learn Forumite
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    jonnygee2 wrote: »
    I still disagree with these changes.

    Although the stories are heartbreaking, the fact is that if mentally capable people instruct a bank to send their money somewhere, the banks job is just to move it. It's up to people to decide where to send their money and to check where their money is going.

    By letting the banks take responsibility for something that's clearly not their fault, it just diminishes the responsibility. It won't be long before people stop worrying if something might be fraud because 'the bank will cover it', in the same way people have generally stopped worrying about unauthorised transactions and security of card details etc.

    The solution is education and information campaigns for consumers, and much better controls at the receiving banks to stop people setting up the dummy accounts that these payments get sent to, or better detection methods so that money in them is frozen before its sent abroad.
    Your solution does not provide protection for the people who are most susceptible to becoming victims of this type of scam, people who satisfy the definition of a 'vulnerable adult'. This is where the new voluntary code can be beneficial, as it will provide these vulnerable groups with a level of protection that they have not had until now.
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    :smiley:
  • jonnygee2jonnygee2 Forumite
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    Your solution does not provide protection for the people who are most susceptible to becoming victims of this type of scam, people who satisfy the definition of a 'vulnerable adult'.

    I do agree with you and in general most banks do a very poor job of looking after vulnerable customers (actually many banks rely on money made from fining them for stuff).

    But banks paying compensation out isn't really protection. The crime is still happening, the fraudsters are still benefitting, people are still going through the emotional stress and there's still a risk it won't be paid back.

    Protection is stopping the payments from being made in the first place. What I've suggested might not be the solution but neither are these changes.
  • ChinoChino Forumite
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    This is where the new voluntary code can be beneficial, as it will provide these vulnerable groups with a level of protection that they have not had until now.
    If there is indeed a 'vulnerable adult' category of adult, then part of the solution to providing this demographic with the "level of protection" you claim they require is by not providing this category of adults access to the same gamut of financial products that are available to "non-vulnerable adults". Online banking would appear to be one such product that should be denied to this "vulnerable adult" category (or, at least, any capability to do anything more than view account balances online).
  • Carrot007Carrot007 Forumite
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    Maybe a middle ground would be forcing people to watch an unskippable video on scams when setting up a new payment!


    Yeah, not gonna happen.


    I would be fine with a drop box to select the type of aquaintence and require 24 hours for anyone not a family/friend (with large fonted explanation of the consequences).


    All this does is make us all pay more for banking in the end.


    You make people pass a test to drive a car, they still may be bad at it but... ;-) You can do just as much damage on the internet, but it would be hard to police. That is why they do nothing about it. Because there is no simple solution. Maybe the banks could invite you in for a 1 hour lecture before setting up online banking! Yeah like they have branches! Could do it online with a live person though.


    In the end people are greedy and fall for scams. I have never had an issue. I am not perfect. It is just common sense.
  • Willing2LearnWilling2Learn Forumite
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    Chino wrote: »
    If there is indeed a 'vulnerable adult' category of adult, then part of the solution to providing this demographic with the "level of protection" you claim they require is by not providing this category of adults access to the same gamut of financial products that are available to "non-vulnerable adults". Online banking would appear to be one such product that should be denied to this "vulnerable adult" category (or, at least, any capability to do anything more than view account balances online).
    The definition of 'vulnerable adult' I am using defines a person who is vulnerable as a result of old age, mental illness or disability or physical disability or other special reason, and will be less able to fend for themselves than an ordinary person so that detriment or harm may result where a less vulnerable person would be able to cope.
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    :smiley:
  • jonnygee2jonnygee2 Forumite
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    The definition of 'vulnerable adult' I am using defines a person who is vulnerable as a result of old age, mental illness or disability or physical disability or other special reason, and will be less able to fend for themselves than an ordinary person so that detriment or harm may result where a less vulnerable person would be able to cope.

    Worth noting also that 'vulnerable customer' is a specific term in banking too, the FCA defines this as 'A vulnerable consumer is someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.'

    There is currently little direct regulation around VCs, but it is expected the FCA will make some significant moves on this at some point this year or next year.
  • Willing2LearnWilling2Learn Forumite
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    jonnygee2 wrote: »
    Worth noting also that 'vulnerable customer' is a specific term in banking too, the FCA defines this as 'A vulnerable consumer is someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.'

    There is currently little direct regulation around VCs, but it is expected the FCA will make some significant moves on this at some point this year or next year.
    Maybe then the new voluntary guidance could be tweaked to only apply to the FCA defined vulnerable customers...to people who are especially susceptible to detriment...
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    :smiley:
  • FlobberchopsFlobberchops Forumite
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    Although authorised push payment scams are on the rise and the consequences can indeed be disastrous and life changing for the victim, I too don't believe the correct way to tackle this is to a) put more obstacles in the way of capable, fully-informed adults accessing their money of their own free will or b) to shift the onus onto the banks to encourage basic due diligence or else refund the victims.


    Seems to me this will generate frustration from customers who want to access their own money like the grown adults they are, and leaves the banks open to first party fraud.
    : )
  • eskbankereskbanker Forumite
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    jonnygee2 wrote: »
    But banks paying compensation out isn't really protection. The crime is still happening, the fraudsters are still benefitting, people are still going through the emotional stress and there's still a risk it won't be paid back.

    Protection is stopping the payments from being made in the first place. What I've suggested might not be the solution but neither are these changes.
    The key preventative measure is Confirmation of Payee, via which banks will be able to refuse to refund a customer who chooses to proceed after being warned that the payee name doesn't match, which I'd imagine is a fairly common scenario with APP scams....

    AIUI, this code of conduct was written on the assumption that it would be implemented at about the same time as CoP, but since the latter has been delayed into next year this leaves a chunk of responsibility with the banks that they'll eventually be able to mitigate via CoP implementation.
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