Realising that you’ve handed over cash to a con artist can be a devastating moment – and as fraudsters become more prolific and scams become more sophisticated, it’s something that’s becoming more and more familiar.
There are now hundreds of scams being pulled off every single day across the UK. Many of these involve having the scammer convince a member of the public to voluntarily transfer money into their account, often by posing as a legitimate organisation such as the government.
At the moment, getting compensation for this type of scam can be a matter of luck. Different banks have different policies which will determine whether or not any of the money is paid back to you.
That’s because the right to compensation is currently determined by a voluntary agreement. While the guidelines encourage banks to provide compensation for customers who have been affected, they don’t provide any legal protection. So, although the majority of banks have decided to support fraud victims, they don’t have to – and this is leaving some people significantly out of pocket.
The government’s plans will make reimbursement mandatory, giving people a much better chance of getting their money back. The new regulations will also mean that the UK’s biggest banking groups have to start publishing their data on fraud compensation, providing some much-needed transparency within the sector.
Speaking about the changes on behalf of banking association UK Finance, managing director Katy Worobec said: “Fraud has a devastating impact on victims and the money stolen funds serious organised crime, so the banking industry’s primary focus is always on stopping these scams happening in the first place.
“Over £300m has been reimbursed to thousands of customers since the APP voluntary code was introduced in 2019. We agree that more needs to be done and have long called for a regulated code, backed by legislation, to ensure consumer protections apply consistently.”
Three things to do if you transfer money to a con-artist
If you’ve been the victim of this type of scam, it’s important not to panic. Lots of people get taken advantage of in this way every day: you’re not alone. You do need to act quickly though, so after making a cup of tea and taking some deep breaths, here’s what to do:
- Contact your back straight away. Explain what has happened, being honest about all of the details. Ask about the possibility of reimbursement. If necessary, remind them that the voluntary agreement suggests banks should reimburse people for this type of fraud.
- Consider following your bank’s complaints process. Your bank aren’t responsible for the scam, but they should do what they can to help you. If you feel like they’re being unhelpful out unfair, you can make a formal complaint. Details of the complaints process should be on a bank’s website.
- Report the scam. Whether you get your money back or not, it’s a good idea to report what has happened. This will allow relevant organisations to take action and warn others. Action Fraud and Citizen’s Advice are two good organisations to go to. Try to provide as much detail as you can.