New anti-fraud measures: unintended consequences

km1500

yes that was my thought as well when I saw the 50/50 liability - I wondered if the receiving banks might be a bit more careful

TheBanker

eskbanker said:

km1500 said:

I have often wondered about the receiving account that the fraudsters control. I know some are 'genuine' accounts that have been hacked but how do they manage to set up.others to receive the funds - fake ID?

It can'tbe that easy to open a new fraudulent account ?

It would be interesting to find out what the impact will be of the move to 50/50 liability sharing between sending and receiving banks, which is only viable once all banks are bound by the reimbursement code - the suspicion could be that some non-CRM challenger banks might currently be more accessible to fraudsters and that they'll have to tighten security once they feel financial pain of reimbursing.

Of course, it'll be difficult to source any reliable stats about fraud incidence per institution - I seem to recall that there were some figures published about which (sending) banks had the highest reimbursement percentages, but information about which banks are more susceptible to fraud will naturally be harder to find!

https://www.psr.org.uk/media/1fodzkt2/specific-direction-18-app-scams-information-march-2023.pdf - The PSR are collecting data from the 18 largest banks, including destination accounts, and will publish some of this from October.

There are certain non-bank payment firms which have a reputation in the industry as being popular with fraudsters. For obvious reasons (I do not want to get sued!) I won't name them here. 

This FCA letter was recently sent to Payment Firms. Outcome 2 is interesting. 

https://www.fca.org.uk/publication/correspondence/priorities-payments-firms-portfolio-letter-2023.pdf

Read into 'the ability to provide bank like services' as you wish. 

km1500

interesting article about fraudster's receiving accounts and money mules

https://www.theguardian.com/money/2023/jun/12/older-people-hired-as-money-mules-by-gangs-as-cost-of-living-crisis-bites