New research from Which? has showed that £674 a minute is lost to bank transfer scams, with the consumer champion calling for all banks to reassure customers they will be better protected against fraudsters by signing up to the new voluntary industry code, which comes into effect next week.

The Payments Systems Regulator recently announced it is consulting further on Confirmation of Payee, delaying its introduction until March 2020, nine months later than its original deadline of July 2019, which Which? argued would result in an additional £109 million being lost to scams.

The following banks have committed to signing up to the code: Barclays, Lloyds Banking Group, HSBC, Metro Bank, Royal Bank of Scotland, NatWest, Santander and Nationwide.

The voluntary industry code of practice is designed to protect people from Authorise Push Payment (APP) scams, where a fraudster tricks an individual consumer or micro business to instruct their payment services provider - such as their bank - to send money from their account to an account controlled by that fraudster.

Three years on from Which?’s super-complaint, it stated that losses from this type of fraud are spiralling out of control, with £354 million lost in the last year alone – most of it from personal accounts.

This figure means that every month, using UK Finance figures, £29.5 million is lost to bank transfer fraud; equating to £970,685 per day, £40,445 per hour, £674 per minute and £11 per second.

Which? has written to UK Finance demanding that the industry meets five tests that will determine the code’s success. These are:

• Banks must promise to protect their customers by signing up to the code with the regulator pledging to conduct a one-year review on its effectiveness.
• The regulator must ensure all banks introduce vital name-check security (confirmation of payee) no later than its new deadline of March 2020.
• No blameless scam victim should ever be denied reimbursement again, and full refunds should be issued swiftly.
• Banks must show they are serious about protecting consumers by immediately agreeing a long-term funding solution for no blame refunds.
• Banks must publish victim and reimbursement figures on a regular basis to allow effective monitoring in the fight against transfer fraud.
Last year, just 23 per cent of losses were returned, meaning victims were left out of pocket by these increasingly sophisticated scams.

Gareth Shaw, head of money at Which?, said: “By adopting this code, banks must offer much greater protection to consumers, while quickly and fairly reimbursing those who are unfortunate enough to fall victim.

“Failure to do so will require swift intervention from the regulator, as these devastating scams can’t be allowed to derail lives any longer.”

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