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New rules to allow fraud victims to complain to the bank receiving their cash

Scam victims who have been tricked into transferring money to a fraudster are to get stronger rights to complain about the bank that received the money, rather than just their own bank.

Under the rule changes, when a fraudster cons a victim into sending them cash – known as an authorised push payment (APP) scam – the consumer will have the power to take their complaint to the bank that has received the money, if they are concerned about how it is handling the situation.

Currently you can only complain to your bank, which has sent the money. 

How will the new rules work?

The new rules are being introduced by the Financial Conduct Authority (FCA) and come into force on 31 January 2019.

They mean the bank receiving the money will HAVE to accept a complaint from the victim, if it relates to how it is handling the situation.

If, after complaining, the scam victim is still unhappy with the way the receiving bank has handled their case, the new rules will allow them to escalate their complaint to the Financial Ombudsman Service (FOS).

How much do UK consumers lose from APP scams?

Data from UK Finance, a trade association which represents banks, shows there were 43,875 cases of APP fraud and total losses of £236 million in 2017.

Historically, banks haven't been obliged to refund customers who fall victim to these types of scams but earlier this year, most major banks signed up to a new voluntary code. This stipulates that where a victim of a scam has met "the requisite level of care", such as taking notice of any warnings from the bank, they should be reimbursed. The code is still being developed.

What does the FCA say?

Christopher Woolard, executive director of strategy and competition, said: "The FCA takes APP fraud and the harm it causes to consumers very seriously.

"Now victims of APP fraud can make a complaint to the PSP [payment services provider] receiving their payment and if they're not satisfied with the outcome, can refer their complaint to the FOS."

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