30% jump in ‘authorised’ scam complaints recorded by ombudsman

A 30% annual jump in “authorised” scam complaints has been recorded by the financial ombudsman.

Overall, it is continuing to uphold around three-quarters of such complaints in consumers’ favour.

Some 4,488 complaints about fraud and scams were received by the Financial Ombudsman Service (FOS) between July to September.

Within the total, 2,243 complaints were about authorised scams, often involving criminals pretending to be legitimate account holders to trick people into sending them money.

This was a 30% increase compared with 1,725 complaints received during July to September 2020.

The increase in the number of people falling victim to scams reflects increased spending online and more fraudster activity during the pandemic, the ombudsman service said.

The vast majority of authorised scam complaints are authorised push payments (APP) where the victim is tricked into making bank transfers to an account posing as a legitimate payee. However, the ombudsman also sees disputes about whether or not the consumer authorised a payment or withdrawal with their bank card.

Many authorised scam complaints are about consumers not receiving the goods or services that they have ordered, or scammers tricking people into moving their money to a “safe account”, or investment scams.

Financial Ombudsman Service interim chief executive and chief ombudsman Nausicaa Delfas said: “It’s a real concern that we are continuing to see an increase in scam complaints, particularly when shopping online.

“With the festive period approaching, it’s vital that people are extra vigilant with their finances. If people feel they have not been treated fairly by their banks, we are here to help.”

Last week, plans were set out for blameless scam victims who have been tricked into transferring money to a fraudster to be legally entitled to reimbursements.

At present, many banks have signed up to a voluntary reimbursement code, but there have been concerns that customers face a lottery as to whether they will get their money back.

The UK Government intends to remove barriers in legislation to enable the regulator to act as needed, following the outcome of a consultation.

Proposals by the Payment Systems Regulator (PSR) could also mean that the UK’s biggest banks are required to publish their performance data in relation to APP scams.

In the first half of 2021, £355 million was lost to APP scams, overtaking card fraud losses.