FRAUD victims who have been tricked into transferring money in scams will be able to receive up to £415,000 back.
That’s according to new requirements for claims coming into force next year, a regulator has confirmed.
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It will now also be mandatory for banks to repay scam victims, where before it had been voluntary.
A recent study of 2,000 adults, found 13% have lost money to fraud – with 7% of those having lost as much as £5,000.
The regulator, the Payment Systems Regulator (PSR), says the £415,000 amount which will come into force from October 7, 2024.
Specifically, the payment will cover authorised push payment (APP) fraud where scammers trick victims into sending them large amounts of money in bank transfers.
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Brits who fell victim to APP fraud lost a combined £485million in 2022, according to UK Finance.
Consumers will also have obligations when claiming money back.
Those will include telling their bank of the scam within 13 months of the last payment and they cooperate with requests for information and with police.
The £415,000 limit is in line with the maximum award the Financial Ombudsman Service (FOS) can make when considering complaints.
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Banks which are on the recieving end of fraudulent bank transfers will also now have an obligation to be involved as they will now also be stung with 50 per cent of the reimbursement.
Rocio Concha, Which? director of policy and advocacy, said: “Consumers are in desperate need of stronger protections, so it is very positive that the Payment Systems Regulator is progressing with its plans for implementing mandatory reimbursement.”
She added: “However, an excess of £100 would mean almost a third of APP scams would not be eligible for reimbursement, unless the victim is vulnerable.
“The PSR must be prepared to change the level of the excess if, as a result of the decision, fraudsters start to focus their attention on lower-value fraud.”
The new rules were set to begin April 2, 2024, but were delayed until October.
There will also be a £100 excess for victims.
How to avoid scams
There are clear red flags to always keep an eye out for when you get a message you’re unsure of.
If you receive a text or email asking for personal details, you can check if it’s real by calling whoever it claims to be from – your bank, for instance, will instantly confirm if it’s fraud and advise what to do.
Any bank, trusted organisation or public bodies like councils or the police would will never ask you to withdraw, transfer or send back money from your account.
If you think you have been a victim of a scam, you should report it as soon as possible.
There is no guarantee you’ll get your money back, but banks will often compensate you if you can show you did not know the money would leave your account.
You can forward scam emails to [email protected] and should also contact your bank and report it to Action Fraud, which will give you a crime reference number.
Check if your bank is signed up to the voluntary APP code, which indicates it has pledged to reimburse customers who have been tricked into sending money to scammers.
If your bank is signed up and refuses to refund you, you can complain and ask it why it is not abiding by the code.
You may be able to report the case to the Financial Ombudsman Service, which could order your bank to compensate you.
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