Banks have been reminded to treat fraud victims fairly and not assume customers were “grossly negligent” following an increase in the sophistication of scams.
The Financial Ombudsman Service (FOS) has told banks they should take into account the evolution and sophistication of frauds and scams.
Banks are not liable for money lost if the customer is deemed to have been “grossly negligent”, but the FOS said the bar for determining whether this is the case should be set “very high” and warned banks to cover customer losses unless they can back such a determination up with facts.
Chief executive of the FOS, Caroline Wayman, said: “Each year we see more than 8,000 cases involving fraud and scams – everything from disputed cash withdrawals and identity theft, through to mobile phone SIM-swaps and fake banking websites.
“And where criminals are involved, both banks and their customers often tell us in strong terms that they haven’t done anything wrong.
“But it’s not fair to automatically call a customer grossly negligent simply because they’ve fallen for a scam.
“That’s especially true in light of the sophisticated way criminals exploit banks’ security systems – and convince customers that their money is at risk.”
Managing director of economic crime at UK Finance, Katy Worobec, said banks took the threat of fraud “extremely seriously” and invest millions in protecting customers.
She added: “But we know there is more to be done.
“Banks will always make every effort to help a customer recover any stolen funds and the industry has introduced new standards on how banks respond to scam victims.”