British banks failing to hit fraud check deadline, say MPs

In the first half of 2019, the public was frauded of more than GBP 600 million, according to the Commons Treasury committee, nevertheless over the same period, the finance industry managed to prevent GBP 820 million of unauthorised fraud.

A new and growing problem is the authorised push payments (APP) fraud, in which people are tricked into transferring money to fraudsters. Criminals are currently exploiting a loophole where, unlike account numbers and sort codes, the recipient's name is not checked and cross-referenced.

Nevertheless, in March 2020 a new system will be rolled out that aims to match actual account names with those provided by consumers and flag any differences. Also, if the deadline passes, companies that do not meet the deadline could face fines. The committee also argued that a voluntary reimbursement code, which came into effect in May 2019, making it easier for scam victims to get their money back, should be made compulsory through legislation, according to Sky News.

Furthermore, the MPs recommended the introduction of a 24-hour delay for all first-time payments to allow consumers to ‘remove themselves from the high-pressure environment in which they are being manipulated’ in the case of money mules.