Banks need to do more to treat people fairly when they are victims of scams, according to the official UK financial sector complaints body, which is in favor of the customer in three-quarters of these cases.
The Financial Ombudsman Service said the number of people who turned to it for help with fraud and scam issues increased by 66% between April 1 and June 30, compared to the same three months in 2020 .
During this period, 60% of complaints for fraud and fraud were accepted in favor of the consumer, against 50% the previous year.
However, when it came to complaints about banks and other businesses refusing to refund money people lost due to scams such as authorized push payment fraud – which often involves account hacking courier – the mediator confirmed three quarters in favor of customers.
A spokesperson said the figures “suggest that banks and other financial institutions still need to do more to fairly resolve customer complaints before people are forced to seek help from the Financial Ombudsman Service.”
Banking body UK Finance said on Wednesday the fraud posed a threat to national security, with £ 754million stolen from bank customers in the first half of this year as crooks capitalized on the coronavirus pandemic .
Cases examined by the ombudsman included fraudsters posing as a customer’s bank and convincing them to transfer their money to a bogus “secure account”, and buyers paying for goods that never arrive.
Nausicaa Delfas, Acting Director General and Chief Ombudsman for the department, said: “It is a real concern that we are seeing such an increase in scams. It is vital that people pay special attention to their finances, as unfortunately fraudsters are becoming more and more sophisticated.
The data also revealed that there had been an increase in complaints about cryptocurrencies during the pandemic, which appeared to have been driven in part by the fraudulent investments advertised on social media.
While cryptocurrencies are unregulated investments, and are therefore mostly outside the remit of the mediator, the mediator can examine complaints about banks refusing to reimburse people who believe they are victims of fraud or of a scam.
He said anecdotal evidence suggested that the increase in complaints about cryptocurrencies could be linked to young people wanting to earn extra money while on leave or simply spend more time online.
Overall, the mediation service received 50,906 complaints about financial companies during the three-month period. Meanwhile, ombudsperson’s business data spanning January through June this year showed that the business with the most new complaints against it – 10,973 – was the provider of high-cost loans. Provident Personal Credit, which is part of Provident Financial.
Separate research from the Nationwide Building Society found that financial worries, the need for quick cash, and a greater tendency to take risks made students a prime target for criminals looking for money mules, where their bank account is used to launder stolen money.
The figures showed that almost a third (29%) of students were willing to take the risk of allowing a third party to use their checking account or transfer money for someone.