Victims of so-called ‘authorised push payment fraud’ (APP) are set to be given new rights by financial watchdog the Financial Conduct Authority (FCA).
Push payment fraud occurs when a fraudster tricks a victim into transferring money out of their bank account, often by purporting to be a trusted person or a financial institution.
According to financial trade body, UK Finance, there were 43,875 cases of APP in 2017 resulting in a total loss of £236 million.
Under current rules, where the victim’s payment service provider is not at fault, they cannot complain to the provider receiving the fraudulent payment.
However, the FCA is consulting on a change that would require receiving firms to handle these complaints in line with current complaints handling rules.
The FCA has also proposed allowing victims to escalate APP complaints to the Financial Ombudsman Service.
In addition, the FCA will look at obliging providers to report data on alleged APP fraud complaints later this year.
Christopher Woolard, the FCA executive director of strategy and competition, comments: “The FCA takes push payment fraud and the harm it causes to consumers very seriously. Our proposals build on our work in this area and seek to reduce the harm experienced by victims of push payment fraud where they believe the bank which received the money did not do enough to prevent it.
“We are proposing to require payment service providers to handle complaints about this in line with our complaint handling rules, and to provide the victims with access to the Financial Ombudsman Service.”