UK bill requiring reimbursement for scams
The UK’s Payments Systems Regulator (PSR) is getting the ability to compel banks to compensate victims of “forced payment scams”, the Financial Times reported on Tuesday (May 10th).
Push payment scams include any situation where a victim sends money to a recipient for what turns out to be a fraudulent reason. The regulator’s decision is meant to show “disparities” in the current compensation approach, which is on a voluntary basis.
According to Rocio Concha, director of policy and advocacy at consumer group Which?, scam victims often face what’s called a “refund lottery” that depends on which bank they’re dealing with. affair. Concha said the regulator will have to make sure companies “treat their customers consistently and fairly.”
The measure, announced on Tuesday, is part of the Financial Services and Markets Bill, which also includes a commitment to ensure continued access to cash withdrawals and deposits.
This all comes after the government said in November it would strengthen the powers of the PSR, laying down rules for banks and other payment service providers, as scams have been on the rise for years since the start of the pandemic.
This all comes as many high street banks became signatories to a voluntary code which was established in May 2019. This added more compensation for victims, but the government criticized the ‘inconsistent’ application, which involved different types of compensation among different banks.
Visa said the level of scams has only become more difficult to manage, with phishing and compromise becoming harder to detect. Dustin White, Visa’s risk data manager, said creativity in scams was “No. 1″ on a fraudster’s resume.
See also: Inside Visa’s Anti-Fraud Cybermachine
This, he said, has led to the success of phishing – 78% of people receiving unsolicited links still click on them. This can lead to malicious actors getting away with a variety of data, allowing them to perform fraudulent transactions down the line.
Often customers don’t know they’ve been scammed for a long time.