Lloyd's seem to be blocking payments to Starling

Guyt79

Had an odd experience and two hour long phone calls (and finally a visit to branch) with Lloyd's today.

But Lloyd's blocked a lump sum payment into my new Starling account as according to the operators in their fraud department, Starling is classified as a high fraud risk bank.

I then had to run through a full justification as to why I wanted to transfer my money to Starling....apparently the reason "I want to transfer my money into my account so I can use it" isn't valid enough. So despite clearing all security questions with Lloyds I had to take photo ID into branch and do the whole process again (over the phone with the fraud team) in the presence of a branch employee (who was really nice and polite and looked rather embarrassed about the whole thing).

Anyone else had issues with Lloyd's blocking payments to the new age banks like Starling or Monzo?

Zanderman

How big a lump sum was this?

sal_III

I would have closed my Lloyd's, while I was at the branch for this BS if I were you.

Herbalus

Seems a little overkill at first glance, but the amount is going to be key, and the historic use of your account.

The Santander app seems to have a fit when I select the reason for a transfer to my Lloyds account as "transfer to my own account" as that's a common fraud technique, but it's something you just get used to.

jonnygee2

But Lloyd's blocked a lump sum payment into my new Starling account as according to the operators in their fraud department, Starling is classified as a high fraud risk bank.

I highly suspect this is a little gem of information that they should not have revealed to a customer. Normally the logic for such decision making is very tightly controlled.

Still, they have the right to ask for extra verification for any transfer that their fraud controls deem as risky. It is a pain but it does also do a lot of good.

Anyone else had issues with Lloyd's blocking payments to the new age banks like Starling or Monzo?

I wouldn't assume that it's anything to do with the age of the bank or that Monzo is also considered 'high risk' by them.

Herbalus

jonnygee2 wrote: »

I highly suspect this is a little gem of information that they should not have revealed to a customer. Normally the logic for such decision making is very tightly controlled.

I suspect what they meant was that they’ve seen a lot of payments go to Starling that were subsequently claimed as fraudulent. So it could be (for example only, I don’t work there and am just guessing), if Starling had very lapse account opening procedures which meant it was easy for fraudsters to open fake accounts there, Lloyds might be more wary of transfers to them and have put extra steps in place.

Or the employee could have just made it up!

[Deleted User]

I’m pretty sure there’s some other posts on here reporting issues with Lloyd’s and Starling.

But I would expect a bank that doesn’t require proof of address (like Monzo) would be high traffic for ML schemes.

jonnygee2

But I would expect a bank that doesn’t require proof of address (like Monzo) would be high traffic for ML schemes.

That's quite the assumption. Monzo actually have a good reputation in the industry for their financial crime prevention regime. Address checks are a small part of the story - they've been forged ever since they were invented.

System

jonnygee2 wrote: »

That's quite the assumption. Monzo actually have a good reputation in the industry for their financial crime prevention regime. Address checks are a small part of the story - they've been forged ever since they were invented.

Application fraud is higher with online v in person applications - this would affect digital banks and the digital channels of traditional providers.

Also, traditional providers experience various issues resulting from people using them as payment mules for app banks.

Emily_Joy

Guyt79 wrote: »

Had an odd experience and two hour long phone calls (and finally a visit to branch) with Lloyd's today.

But Lloyd's blocked a lump sum payment into my new Starling account as according to the operators in their fraud department, Starling is classified as a high fraud risk bank.

I then had to run through a full justification as to why I wanted to transfer my money to Starling....apparently the reason "I want to transfer my money into my account so I can use it" isn't valid enough. So despite clearing all security questions with Lloyds I had to take photo ID into branch and do the whole process again (over the phone with the fraud team) in the presence of a branch employee (who was really nice and polite and looked rather embarrassed about the whole thing).

Anyone else had issues with Lloyd's blocking payments to the new age banks like Starling or Monzo?

sal_III wrote: »

I would have closed my Lloyd's, while I was at the branch for this BS if I were you.

Lloyds Fraud department will block any transfer from my account if the amount is above £500 and sometimes online card payments if the amount is over £100. I never thought of closing the account - just visit a branch if I need to make a transfer for an amount they consider as "significant".

I doubt it has anything to do with Starling. In my case the payments to my ISA and LISA were blocked.

Herbalus

Emily_Joy wrote: »

Lloyds Fraud department will block any transfer from my account if the amount is above £500 and sometimes online card payments if the amount is over £100. I never thought of closing the account - just visit a branch if I need to make a transfer for an amount they consider as "significant".

I doubt it has anything to do with Starling. In my case the payments to my ISA and LISA were blocked.

I find that a bit difficult to believe. I make transfers of over £500 every single month from my Lloyd’s account. They are all to existing payees but £500 seems a very low amount.