Card fraud: best and worst banks for unfairly rejecting claims

Victims of card fraud are meant to be refunded immediately, but new figures suggest some banks are rejecting a high proportion of claims unfairly.

Barclays is unfairly rejecting claims from card fraud victims in more than a third of cases, a new investigation by consumer site Which? has revealed.

The bank was found to have the worst record for handling credit and debit card fraud-related issues between April 2015 and February 2017.

Banks are meant to refund victims of card-fraud immediately, unless it suspects something suspicious, but they don’t always make the right call.

Victims that think they have been unfairly treated by their bank have a right to take their case to the Financial Ombudsman Service (FOS) to make a complaint.

Figures from the FOS show that there were 6,000 complaints about ‘disputed transactions’ which relate to credit and debit card fraud including things like misplaced transactions, missing payments, ATM disputes and debits applied incorrectly by retailers.

Of these, about 5,800 complaints related to credit and debit card fraud between April 2015 and February 2017, with 28% upheld in favour of customers.

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Worst banks for refunding victims of card fraud

The table below show the banks with the worst uphold rate for complaints about card fraud, indicating the customers most likely to have had their claim unfairly rejected by their provider.

 Source: Which? analysis of Financial Ombudsman Service data

*Table relates to complaints about ‘disputed transactions’ between April 2015 and February 2017 and includes banks with at least 100 complaints received

Barclays had the worst record for handling fraud-related complaints with an uphold rate of 36%.

But even TSB, the ‘best’ of the banks in the research, had unfairly rejected one in five (20%) of claims from their customers according to FOS adjudicators.

Barclays has recently taken a more proactive approach scams and fraud with new powers for customers to fight back, (take a look at: Barclays launches new debit card features to fight scammers) but it admits there is more to do.

 A Barclays spokesperson told Which?: "We know from independent data that we’re making progress, but there is still more to do as these figures show. We will continue to take the action required to deliver the best possible experience for our customers."

Harry Rose, who works at Which?, said: “Banks will always be a target for criminals and they have a duty to spot and respond to new threats.

"Most are working hard to combat card fraud, but we still hear from those who say their bank made them feel like a criminal, not a victim.”

What is card fraud?

According to Financial Fraud Action UK, incidents of card fraud have doubled since 2011.

Financial fraud costs the UK £2 million every day, largely driven by debit and credit card fraud, which accounted for 80% of losses in 2016.

Here are the five main types of card fraud to watch out for:

Remote purchase fraud – when card details are stolen and used to buy goods online, buy phone or by mail order.

Lost and stolen cards – criminals can use lost and stolen cards to make purchases and potentially withdraw funds from a cash point.

Card not received fraud – when a new or replacement card is stolen before you receive it.

Counterfeit card fraud – when your card is cloned and used in other countries that don’t need chip and PIN for transactions.

Card ID theft – when stolen or fake documents are used to open a new account in another person’s name or when a criminal hijacks an existing account.

What to do if you fall victim

If you think you’ve become a victim of card fraud you should contact your card provider immediately.

They should be able to reimburse losses so long as you have taken the proper precautions with your personal details.

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What to do if you have a complaint

If your card provider won’t refund your money then you can complain to the Financial Ombudsman Service. Read our guide on how to go about making a complaint: How to complain to the Financial Ombudsman Service.

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