Police chief calls for end to bank fraud refunds

Head of Met Police claims current system rewards people for bad behaviour.

A police chief has said he believes the system of banks refunding customers for online fraud losses “rewards” the public for being lax about their internet security.

Sir Bernard Hogan-Howe, the head of the Metropolitan Police, called on banks to consider stopping refunds to some victims as it might make people more vigilant about their online security.

Losses due to internet banking fraud hit £133.5 million in 2015, a rise of 64% in just 12 months. At present if you are the victim of online fraud you can expect to receive a full refund, unless the bank or card supplier can prove you have been “grossly negligent".

But Sir Bernard told The Times this system means people are “continually rewarded for bad behaviour”.

“The system is not incentivising you to protect yourself,” he told the newspaper. “If someone said to you ‘if you’ve not updated your software I will give you half back,’ you would do it.”

"Astonishingly misjudged"

However, Sir Bernard’s comments have not gone down well with consumer groups.

“With online fraud increasing, this is an astonishingly misjudged proposal from the Met Police Commissioner,” said Which? Executive director Richard Lloyd. “When we investigated last year, we found too often that banks were dragging their feet when dealing with fraud. The priority should be for banks to better protect their customers, rather than trying to shift blame on to the victims of fraud.”

Paul Green, director of communications at Saga, said that blaming the victims of crime was no way for anyone to behave, let alone a senior police commissioner. He added: "Keeping up with scams is almost a full-time job.”

Sir Bernard made his comments as the police are preparing to include cybercrime in official crime statistics for the first time later this year. It is believed that figures will double as a result of the change.

Earn 5% interest from your bank account

Financial fraud is changing

Banking fraud is becoming increasingly sophisticated as criminals try to circumnavigate bank security systems according to research by Financial Fraud Action UK.

“Banks use highly sophisticated security systems to protect their customers, which last year stopped £7 in £10 of fraud from occurring, so criminals are now focusing on targeting consumers directly,” says a spokesperson for Financial Fraud Action UK. “Fraudsters are using deception and impersonation scams to trick people into giving away their personal or financial details.”

How to protect yourself

Make sure you keep the security software on your computer and smartphones up-to-date and regularly run anti-virus software. Also, create strong passwords that are hard to hack and keep them secure.

As fraudsters try new ways to separate you from your cash, be on your guard when you receive unsolicited calls, texts or emails that ask you for personal or financial information.

“Fraudsters are after people’s details which are effectively the keys to the security door – do not let them in,” says the spokesperson for Financial Fraud Action UK.

Earn 5% interest from your bank account

Be better off with loveMONEY:

The tax and benefit changes coming in from April

How to beat Stamp Duty

 

Comments


Be the first to comment

Do you want to comment on this article? You need to be signed in for this feature

Copyright © lovemoney.com All rights reserved.

 

loveMONEY.com Financial Services Limited is authorised and regulated by the Financial Conduct Authority (FCA) with Firm Reference Number (FRN): 479153.

loveMONEY.com is a company registered in England & Wales (Company Number: 7406028) with its registered address at First Floor Ridgeland House, 15 Carfax, Horsham, West Sussex, RH12 1DY, United Kingdom. loveMONEY.com Limited operates under the trading name of loveMONEY.com Financial Services Limited. We operate as a credit broker for consumer credit and do not lend directly. Our company maintains relationships with various affiliates and lenders, which we may promote within our editorial content in emails and on featured partner pages through affiliate links. Please note, that we may receive commission payments from some of the product and service providers featured on our website. In line with Consumer Duty regulations, we assess our partners to ensure they offer fair value, are transparent, and cater to the needs of all customers, including vulnerable groups. We continuously review our practices to ensure compliance with these standards. While we make every effort to ensure the accuracy and currency of our editorial content, users should independently verify information with their chosen product or service provider. This can be done by reviewing the product landing page information and the terms and conditions associated with the product. If you are uncertain whether a product is suitable, we strongly recommend seeking advice from a regulated independent financial advisor before applying for the products.