compensation
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Banks to pay push payment scam compensation

A number of leading banks have agreed to contribute to a fund for victims of push payment scams.

Push payment scams happen when cybercriminals trick someone into sending them money by pretending to be someone else. Push payment scams saw £148 million lost in the first half of 2018.

Banks that have signed up to the new push payment scam compensation fund include Barclays, HSBC, Lloyds and RBS. Other banks such as Santander and Nationwide, have also made a similar commitment.

Historically, banks have avoided paying push payment scam compensation to victims unless there was a fault in their processes. This is because the customer authorised the payments.

The scheme will be introduced as an interim measure until a permanent solution can be agreed. It is expected that banks will reimburse somewhere between £30million and £40million more in push payment compensation in 2019 as compared to last year.

How to protect yourself from push payment fraud

Action Fraud – the national fraud reporting service – recommends taking the following advice to stay safe:

  • Be suspicious of requests to transfer money by bank transfer or virtual currency instead of safer methods (e.g. credit card or payment services such as PayPal)
  • Trust your instincts. If something feels wrong then it is right to question it
  • Don’t pay for goods or services unless you know and trust the individual or business
  • Be aware that personal information obtained from data breaches is making it easier for cybercriminals to create highly targeted phishing messages and calls
  • Don’t assume a person/organisation is genuine just because they’re able to provide some basic details about you
  • Always be suspicious of unsolicited requests for your personal or financial information.

Also, it’s important to understand that your bank would not:

  • Ask you to share any sensitive information about yourself or your accounts, like your PIN or full banking password
  • Ask you withdraw or transfer money for safekeeping
  • Send someone to your home to collect cash, a PIN, cards or cheque books
  • Try to panic you out of taking security checks.

A win for consumers

Commenting on the new push payment scam compensation fund, a spokesperson at consumer group Which?, said: “This long-awaited move to ensure victims of bank transfer scams are properly reimbursed when neither they nor the bank is at fault is a major victory for consumers.

“The banks must now act to ensure this scheme is implemented swiftly so consumers can have confidence that losing life-changing sums of money to this type of fraud is a thing of the past.”

What can you do if you are the victim of push payment fraud?

If you have been the victim of an attempted push payment scam, you should contact Action Fraud. However, if you have lost money as a result of the scam, you must also report it as a crime. You should also notify your bank ASAP.

At Hayes Connor Solicitors, we want to reduce the number of data violations and successful cyber scams taking place across the UK. To do this, we are raising awareness of this issue and educating people to help stop fraudsters in their tracks.

For more advice on how to keep safe, follow us on Twitter and Facebook.

Alternatively, if you have been the victim of a push payment scam, find out how we can help you to recover any losses or give us a call our office to discuss your case in more depth. We can help you to claim compensation and steer you through the aftermath of a bank or credit card scam – minimising the impact on you as much as possible.

PUSH PAYMENT
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Scheme to better protect banking customers from push payment scams is delayed

Push payment scams happen when cybercriminals trick someone into sending them money. They do this by contacting you via phone, email or social media and pretending to be someone else.

Last year push payment scams cost nearly £150million in the first six months alone.

Typical push payment scams include:

  • Sending fake invoices that look exactly like ones people are expecting (e.g. from a child’s school or a legitimate tradesperson)
  • Convincing people to transfer money to someone official (e.g. such as a solicitor when buying a house)
  • Conning people to move cash into fraudulent bank accounts
  • Sending emails pretending to be from a friend asking for money.

In response, a new system which alerts anyone making a payment if the recipient’s name doesn’t match their bank account number is being introduced. The Confirmation of Payee system has been designed to protect banking customers from push payment scams better.

However, a UK Finance boss has told MPs that the new system will be delayed because it requires a complex change in banks’ IT and processing systems.

Why are push payment scams so popular with cybercriminals?

In most cases, the push payment scam is successful because the victim believes the fraudster to be genuine. And because only account numbers and sort codes are currently used to establish where payments are being sent, the banking system makes it easy for scammers to trick people into sending them money.

However, the new system will alert customers when they are about to transfer money into the account of someone with a different name to the one they believe they are sending a payment to.

Can people get their money back after push payment scams?

Historically, banks and other organisations have avoided paying push payment scam compensation to victims. This is because the customer authorised the payments. However greater protections have now been introduced to help victims of push payment scams to secure compensation. But, to get your money back, you must be able to show that you were not to blame for the fraud.

What is happening to protect people from push payment scams?

As well as the new Confirmation of Payee system there are some other changes to be aware of. For example, in the past, you could only complain to your own bank if you were scammed into transferring money. However, you can now also complain to the bank that received your cash (the bank that the fraudster used). This rule has been introduced to encourage banks to do more to identify when cybercriminals are using their services.

If you’re not happy with the response from the banks, you can also refer your complaint to the Financial Ombudsman.

The Ombudsman has highlighted the “increasing sophistication of criminals’ methods”. It argues that in many such scams, “people are often manipulated into thinking their money’s at risk”. And that this is something it will “think carefully about before deciding whether someone’s acted in a way that goes beyond what might be described as careless.”

However, even where you do have a claim for reimbursement, fraud victims whose banks refuse to refund their losses can see the appeal process drag on for months. In fact, the average wait for those taking their case to the Financial Ombudsman Service is a staggering 215 days.

So banking customers must remain vigilant.

How to protect yourself from push payment fraud

  • Understand that your bank (or the police etc.) will never:
    • Ask you to share any sensitive information about yourself or your accounts, like your PIN or full banking password
    • Ask you to withdraw or transfer money for safekeeping
    • Send someone to your home to collect cash, a PIN, cards or cheque books
  • Always question who you’re talking to. If in any doubt call them back using trusted contact details (you can usually find these on your bank cards)
  • Be aware that scammers might have information about you such as your name, email address, phone number etc.
  • Don’t be pressured or rushed into anything. A legitimate organisation would never try to panic you out of taking security checks
  • Leave the conversation if it makes you at all uncomfortable.

Reporting push payment fraud

If you have been the victim of an attempted push payment scam, you should contact Action Fraud ASAP. Action Fraud is the national fraud reporting service. However, if you have lost money as a result of the scam, you must also report it as a crime.

At Hayes Connor Solicitors, we want to reduce the number of data violations and successful cyber scams taking place across the UK. To do this, we are raising awareness of this issue and educating people to help stop fraudsters in their tracks.

For more advice on how to keep safe, follow us on Twitter and Facebook.

Alternatively, if you have been the victim of a push payment scam, find out how we can help you to recover any losses or give us a call our helpline to discuss your case in more depth. We can help you to claim compensation and steer you through the aftermath of a bank or credit card scam – minimising the impact on you as much as possible.

 

What can you do if your bank refuses to reimburse you following a Push Payment Scam?
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What can you do if your bank refuses to reimburse you following a Push Payment Scam?

A push payment scam happens when a cybercriminal tricks someone into sending them money online. And it’s more common than you might think. In fact, in 2017, UK bank customers lost more than £236m due to push-payment scams.

In most cases, the push payment scam is successful because the victim believes the fraudster to be genuine. For example, scammers often call people up claiming to be the police or the bank. They might state that someone is at risk of a security threat, and that they are calling to help stop it. In other cases, an email with an address that looks genuine could request payment (e.g. from a solicitor or tradesperson).

The money lost due to push payment scams can be devastating. For example, a mother and daughter In Kent were tricked out of their life savings after unknowingly transferring £113,665 to a criminal, rather than their solicitor.

Another woman was conned into losing her mother’s care-home fees after a criminal claiming to be from her bank’s fraud team flagged up unusual transactions on her bank account. The fraudsters ran through some security questions and extracted the information they needed to access her account and rename her current account “frozen”. When the woman went to check online, it did appear that her account had been locked. She was then asked to move her balance to a new “protected” account. However, when she called her bank to check the transfer had gone through, they knew nothing about it.

Historically, banks and other organisations have avoided paying push payment scam compensation to victims. And, because payments have been authorised by the customer, there has been little chance of redress.

So, can you get compensation for a push payment scam?

If you have been the victim of a push payment scam and need help getting your money back, there is some good news.

The industry has recently introduced stronger protections to help victims of push payment scams to secure compensation. It has also set out a new industry code designed to minimise the number of scams by encouraging consumers to remain vigilant.

What this means is that you can be confident that any claim for reimbursement will be given fairer and quicker consideration. And that your bank (or another financial provider) can only refuse to reimburse stolen funds where you have shown a very significant degree of carelessness. Crucially, banks should not automatically blame the victims of increasingly sophisticated scams and must take a fairer approach to compensation.

Where a bank still refuses compensation, you can take your case to the Financial Ombudsman Service.

If you want to claim compensation following a push payment scam, Hayes Connor can help. Our professional, friendly team will be pleased to answer any questions you might have, and advise you on whether you have a valid claim.

If you have a straightforward push payment scam case, our quick claims form will help you to start this quickly and easily. This means you receive your compensation in the shortest possible time. However, if we believe you have a large, complex case, we’ll go through your options and may be able to act for you on a NO WIN, NO FEE basis.

At Hayes Connor Solicitors we make sure you receive the maximum compensation possible in the shortest possible time. However, with strict time limits in place for making push payment fraud compensation claims, it’s essential to act now.

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