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Banks accused of leaving vulnerable customers at risk

Top banks accused of leaving vulnerable customers at risk of fraud after failing to implement important safeguards

  • TSB, Virgin Money and Metro Bank are amongst these criticised for not utilizing affirmation of payee checks, which had been launched by most rivals final year 
  • They purpose to cease fraudsters from pretending to be another person and tricking victims into sending them money 
  • The checks imply that these sending money should enter the recipient’s right identify – if account particulars don’t match, the financial institution can block fee

Top banks have been accused of leaving vulnerable customers at risk of fraud after failing to implement important safeguards. 

TSB, Virgin Money and Metro Bank are amongst these criticised for not utilizing affirmation of payee (COP) checks, which had been launched by most rivals final year. 

They purpose to cease fraudsters from pretending to be another person and tricking victims into sending them money. The checks imply that these sending money should enter the recipient’s right identify. If account particulars don’t match, the financial institution can block fee. 

Failure: TSB, Virgin Money and Metro Bank are amongst these criticised for not utilizing affirmation of payee checks

This ought to, for instance, forestall criminals contacting victims and telling them they should pay money to a legitimate-sounding account reminiscent of HM Revenue & Customs. 

But TSB, Virgin and Metro have all didn’t put the additional safeguard in place, prompting issues amongst different banks. 

The problem not solely impacts customers of the banks but additionally anybody who sends them money. James Daley, of Fairer Finance, stated the ‘time for excuses was working out’ for banks that had been but to implement the safeguards. 

Rival banks really feel frustration at TSB as a result of it processes a better quantity of transactions. It was one of a number of quizzed by Home Secretary Priti Patel final month on how they had been stopping fraud funding organised crime. 

The dialog targeted on COP checks, in accordance with an individual acquainted with the talks. One trade supply claimed: ‘TSB are the financial institution more than likely to be the weak hyperlink. We cannot flag fraudulent funds to a TSB account if they are not within the COP system, as a result of we won’t see there is not a match.’ 

Losses to so-called authorised push fee fraud, the place the sufferer is tricked into approving a fee, totalled £207.8m within the first half of final year. 

Referring to the truth that TSB’s dad or mum, Spanish financial institution Sabadell, put the UK lender up on the market at the top of final year, the banking supply added: ‘You need to surprise if TSB will not be bothering to place the know-how in for COP checks as a result of they know they’re going to be bought.’ 

A spokesman for TSB denied this and stated: ‘We are aiming to introduce affirmation of payee within the coming weeks.’ Virgin stated it plans to implement the checks ‘later this year’. Metro has stated it has no plans to introduce them.

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