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Confirmation of payee not used by some banks and building soceites

I am often concerned when I set up a bank transfer to an account with a building soceity to find that there is no confirmation of payee. It seems not all financial institutions have signed up to the scheme.

Coventry Busilding Soceity and Yorkshire Building Soceity are two i know of who are not part of the scheme.

Is anyone else concerned?

Any thoughts about how we can persuade them to sign uo?





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Comments

  • eskbanker
    eskbanker Posts: 35,345 Forumite
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    The implementation was deliberately phased with only the six largest banking groups directed to go in the first tranche, with more choosing to participate since then, and the regulator has subsequently been in extensive consultation with the industry about extending coverage to the rest, so it's not a case of 'us' 'persuading' them!  Some building societies are more complex where they choose not to use the standard banking sort code structure and stick with roll numbers, so the protocol has to be adjusted to accommodate these.

    https://www.psr.org.uk/publications/consultations/cp22-2-confirmation-of-payee-requirements-for-further-participation-in-cop/

    At the time of issuing SD10, the directed banks covered around 90% of transactions made via Faster Payments and CHAPS. Our rationale at that time for not going further and directing more PSPs was to ensure CoP was established quickly. Since then, a number of non-directed PSPs have voluntarily joined the service, so that there are now a total of 33 PSPs offering the CoP service.

    We are keen to see more firms providing Confirmation of Payee (CoP) protection and want to take further action to achieve that. This consultation outlines our plans to direct around 400 more financial firms to introduce the added security measure.

    This will happen in two groups.  

    • The first group will be prioritised based on the complexity and size of the institution and/or firms where the adoption of CoP could have the biggest impact in preventing APP scams. This first group would see an increase of CoP coverage from 92% of transactions made via Faster Payments to 99%. This group would need to have implemented CoP by 30 June 2023. 
    • The second group includes all other firms which use either unique sort codes, or that are building societies using a Secondary Reference Data (SRD) reference type. This group would need to have implemented CoP by 30 June 2024. 
  • masonic
    masonic Posts: 25,584 Forumite
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    I'm not concerned at all. The humble £1 test payment still has its place, and other systems such as Open Banking or debit card payments are used by some providers not yet part of the scheme.
  • kaMelo
    kaMelo Posts: 2,741 Forumite
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    edited 24 July 2022 am31 11:39AM
    No I'm not concerned at all, as @masonic said a small test payment has worked for me for years.
    I'm more disturbed by the mention of how CoP will help protect against APP. Cop will help stop fat finger mistakes but there are enough red flags ignored with APP fraud already,  CoP is just another red flag that will be ignored by the victim.
  • Daliah
    Daliah Posts: 3,792 Forumite
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    I am not concerned about the lack of CoP at all but I am concerned if people think CoP will save them from fraudsters, specifically APP scams.
  • eskbanker
    eskbanker Posts: 35,345 Forumite
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    kaMelo said:
    I'm more disturbed by the mention of how CoP will help protect against APP. Cop will help stop fat finger mistakes but there are enough red flags ignored with APP fraud already,  CoP is just another red flag that will be ignored by the victim.
    Daliah said:
    I am not concerned about the lack of CoP at all but I am concerned if people think CoP will save them from fraudsters, specifically APP scams.
    It seems to me that CoP should help reduce APP fraud, albeit it obviously won't eliminate it entirely - apart from some initial implementation flaws around messaging and coverage, I don't see a downside to the principle of highlighting to a payer that the proposed payee might not be who they intended to pay?

    https://en.wikipedia.org/wiki/Perfect_is_the_enemy_of_good
  • kaMelo
    kaMelo Posts: 2,741 Forumite
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    eskbanker said:
    kaMelo said:
    I'm more disturbed by the mention of how CoP will help protect against APP. Cop will help stop fat finger mistakes but there are enough red flags ignored with APP fraud already,  CoP is just another red flag that will be ignored by the victim.
    Daliah said:
    I am not concerned about the lack of CoP at all but I am concerned if people think CoP will save them from fraudsters, specifically APP scams.
    It seems to me that CoP should help reduce APP fraud, albeit it obviously won't eliminate it entirely - apart from some initial implementation flaws around messaging and coverage, I don't see a downside to the principle of highlighting to a payer that the proposed payee might not be who they intended to pay?

    https://en.wikipedia.org/wiki/Perfect_is_the_enemy_of_good
    I don't see a downside in implementing CoP either, I was somewhat sceptical about it initially but now it's up and running my scepticism was unfounded. CoP will, as I mentioned earlier, be helpful in preventing fat finger mistakes.

    It's not that I think along the lines of "Perfect is the enemy of good" quite the contrary actually. CoP should be extremely helpful in reducing APP fraud, I just don't believe it will do so. To get to the stage of a name mismatch through CoP a potential fraud victim has already ignored multiple warning signs that all is not well with what is happening, my fear is a name mismatch is simply one more thing to be ignored rather than the red flag that makes then stop and think. 

  • masonic
    masonic Posts: 25,584 Forumite
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    edited 24 July 2022 pm31 7:00PM
    The script will no doubt go along the lines of...
    "We've set up a safe account for you to transfer your savings into to protect them from the fraudsters trying to steal them. As it has only been created today, I need to warn you that you will get an error about the name not matching. Our systems update overnight, but you can click to continue and make the transfer. It's important that we get your money moved to a safe place as soon as possible."
    That said, the actual warning displayed could be made clear enough to break someone out of trusting what they have been told. If the system is rolled out universally, then a statement that "the account you are sending this money to belongs to someone else, and it is not the name you have entered" could be made, rather than "the name cannot be verified" for an account not part of the scheme.
  • EdSwippet
    EdSwippet Posts: 1,637 Forumite
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    masonic said:
    The humble £1 test payment still has its place, ...
    Recently, my bank (first direct) blocked a second large payment that I made after exactly this, a £1 test payment made a day earlier, receipt verified. On having it out with them, they stated that a small payment followed by a much larger one is apparently one of their signals of fraudulent or suspicious account activity, so they blocked the second payment.

    This seems bonkers to me, since it disincentivises one of the main ways of verifying payment details absent CoP. I pointed this out. They took no notice. Shrug.

  • masonic
    masonic Posts: 25,584 Forumite
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    edited 24 July 2022 pm31 9:07PM
    EdSwippet said:
    masonic said:
    The humble £1 test payment still has its place, ...
    Recently, my bank (first direct) blocked a second large payment that I made after exactly this, a £1 test payment made a day earlier, receipt verified. On having it out with them, they stated that a small payment followed by a much larger one is apparently one of their signals of fraudulent or suspicious account activity, so they blocked the second payment.

    This seems bonkers to me, since it disincentivises one of the main ways of verifying payment details absent CoP. I pointed this out. They took no notice. Shrug.
    Strange, as I've done this dozens of times with FD without issue. On one occasion where it was flagged, it was a third payment that did it, and the person I spoke to said something along the lines of "I can see you've done a £1 test payment, which is sensible, has that gone through ok?" But perhaps I've trained their fraud algorithms to see this as normal behaviour for my account. I do it out of habit, even when CoP is available.
    For me Lloyds was the only bank that ever gave me any difficulty around a test payment followed by a large payment, and that was quite some time ago.
  • RG2015
    RG2015 Posts: 6,007 Forumite
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    edited 24 July 2022 pm31 10:44PM
    masonic said:
    I'm not concerned at all. The humble £1 test payment still has its place, and other systems such as Open Banking or debit card payments are used by some providers not yet part of the scheme.
    I am concerned that some savings accounts have minimum opening deposits, such as the Ford Money fixed savers. Hence the £1 test is not possible.

    Ford Money is a trading name of FCE Bank which is the payee for all FM savers, distinguished by a unique FM reference / account number.

    CoP does work for FCE as a business account although the account/reference is not verified.

    In practice I channel all payments to a single Flexible Saver.


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