Business & Investment

Victims of online shopping fraud will continue to be covered by fraud prevention codes

Banks failed to bid to ease protection for online shopping fraud as Watchdog confirmed that victims would continue to be subject to refund pledges

  • Banks wanted to exclude purchase fraud from fraud prevention codes
  • They feel they don’t have to pay when the victim loses money this way
  • The guard dog said it would not undermine the protection of the victims
  • It was also revealed that between May 2019 and July 2020, when the code was introduced, only 41% of fraudulent losses were returned to victims.

Victims who have lost hundreds of pounds in online shopping fraud will continue to be subject to the fraud prevention code even after the bank’s call for waterdown protection has been denied.

Watchdog, which oversees authorized push payment fraud codes signed by nine banks, said victims of purchase fraud should continue to be reimbursed for losses if they were not blamed.

Some banks are asking them to exclude these scams from their code because victims lose less money on average and cases take “disproportionate time to evaluate.” Banks want to focus on customers who are suffering from greater money. loss. ‘

However, banks have refunded only 41% of victims of push payment fraud, so even those who have made large losses do not appear to be properly protected.

Unclaimed victims of online shopping fraud will continue to be covered by fraud prevention codes

However, the £ 37.2m lost in these online shopping scams between May 2019 and July 2020, when the code was introduced, is only £ 257m lost to push payment scams. It accounted for 14%, but 59%. Case.

The Lending Standards Commission said a significant number of people would remain unprotected and was not persuaded that “purchase fraud should be excluded from the code simply because it has the highest number of cases evaluated. “.

Decision, which LSB echoed a comment to This is Money two weeks agoIs a blow to banks trying to encourage watchdogs to remove purchase fraud protection from fraud prevention codes.

Bank submissions to a 32-page review released Thursday morning were kept private, but Sterling founder and CEO Anne Boden previously reimbursed victims of this type of fraud. Said to do. Purchasing non-existent products through advertising on social media platforms is “not intended by the code.”

She said that 45% of purchase scams cost less than £ 300.

Reviews also occur when the majority of fraud victims are sent directly to a fraudster, even though the code states that the victim should be refunded if not accused. It has been revealed that even if you become a victim of a permitted push payment scam, you will not be refunded.

However, only 41% of the money lost in these scams was reimbursed in 123,066 scams evaluated based on the code between May 2019 and July 2020, with 257 million victims. We have regained £ 106.5 million of the pound loss.

Large banks are most likely to repay the full amount by hand to the victim of payment fraud, but still have a 33% chance of repayment.

Large banks are most likely to repay the full amount by hand to the victim of payment fraud, but still have a 33% chance of repayment.

Only 27% of the loss was fully repaid and £ 41 was returned for every £ 100 lost in the fraud. According to last year’s survey, some banks had a 1% chance of giving refunds to their customers.

Victims of purchase fraud were also least likely to get their money back, according to another number released by the LSB, with 4 out of 10 cases being fully or partially refunded to customers.

Large banks such as Barclays, HSBC, NatWest, and Lloyds are more likely to refund their customers in full, according to anonymous data from nine code signers, but still 33% of victims. Probability returned all losses.

However, medium-sized banks refunded customers in just over 30% of the time.

Victims of purchases and romance scams were least likely to get their money back

Victims of purchases and romance scams were least likely to get their money back

The announcement follows LSB’s previous findings released in April last year, “resuming reimbursement to victims was sometimes canceled,” and banks avoid refunds to fraud victims. I was using a general warning that had no effect.

A review of voluntary norms required by the banking industry group UK Finance to make it mandatory and legalized also suggested that banks would automatically refund customers if losses fell below a certain amount, but some People even suggested that the norms need to be amended, excluding scams under £ 250 and victims’ losses will be automatically refunded.

However, this was rejected by the Watchdog, who said the victim could get the money back, but could be “not properly supported” by the bank.

Emma Lovell, Chief Executive Officer of the LSB, said: ‘The answer received from this consultation shows that the purpose of the code is supported by the industry, and I know that when applied correctly, it will enhance customer protection, but do more.

The Seven Deadly Sins

Victims lose hundreds of millions of pounds each year to drive payment fraud.

Theoretically, not only will it make it easier for victims to get their money back, but the APP code, introduced at the end of May 2019, is designed to prevent this type of scam in the first place.

These scams fall into seven major categories.

Scam purchase: Prepaid for goods or services that the victim has never received.

Investment fraud: When the victim pays for a fake investment that provides high returns.

Advance payment fraud: They believe that if the victim pays, a much higher payment or higher priced product will be released.

Romance scam: When paying for someone who believes the victim is in a romantic relationship.

Spoofing scams: When the victim is contacted by a scammer who pretends to come from the police or the victim’s bank and pays to a “safe” account owned by the scammer or persuades him to pay a fine that does not exist. ..

Invoice fraud: The victim attempts to pay the invoice to a legitimate recipient, but the fraudster intervenes and persuades the victim to redirect the payment to the fraudster’s account.

CEO Scam: The victim attempts to make a legitimate payment, but the fraudster impersonates the CEO of the victim’s organization or other senior management and persuades the fraudster to redirect the payment to the fraudster’s account.

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Victims of online shopping fraud will continue to be covered by fraud prevention codes

https://www.dailymail.co.uk/money/beatthescammers/article-9197255/Online-shopping-scam-victims-covered-anti-fraud-code.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Victims of online shopping fraud will continue to be covered by fraud prevention codes

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