Scams have become a widespread issue in the UK, with millions of pounds stolen from victims every year. UK Finance reported that £1.17 billion was lost to fraud in 2023. You might assume that your bank will not refund you, but this isn’t always the case.
This article will explain whether banks refund scammed money, the new refund rules introduced in October 2024, and how you can claim your funds back. If your bank has rejected your claim or failed to protect you, read on to learn how CEL Solicitors can help.
What is a Scam?
Scams come in many forms, and it can often be difficult to spot them as methods used by fraudsters are becoming more sophisticated.
Some of the most common scams include:
Romance Scams: Scammers form fake romantic relationships online to manipulate victims into sending money.
Investment Scams: Fraudsters promise high returns on investments that don’t exist.
Purchase Scams: Fake sellers trick victims into paying for goods or services that never materialise.
Impersonation Scams: Scammers pose as bank representatives, police officers, or utility providers to convince you to transfer money or share sensitive details.
If you’ve fallen victim to any of these scams, it’s crucial to report the fraud to your bank as quickly as possible.
Will My Bank Refund My Scammed Money?
Under new rules effective from October 7, 2024, UK banks, building societies, and savings providers are required to refund most victims of authorised push payment (APP) fraud.
According to UK Finance’s Annual Fraud Report, over £459 million was lost to push payment fraud in 2023. Banks refunded £287.3 million to victims through the voluntary reimbursement system, resulting in a 62% refund rate, an increase from 59% in 2022.
The Payment Systems Regulator (PSR) introduced these rules for fair treatment of scam victims. Previously, banks would assess cases individually, and refunds were not guaranteed. Now, all banks must refund eligible victims, provided they haven’t acted with gross negligence.
What is Gross Negligence?
Gross negligence refers to cases where the victim ignored clear warnings from their bank or failed to take reasonable steps to protect their money. For example:
- Ignoring scam alerts while making a payment.
- Sharing personal banking details despite warnings.
However, if you’ve followed your bank’s advice and acted responsibly, you should be eligible for a refund.
If your bank refuses to issue a refund, financial recovery companies like CEL Solicitors may be able to help you get your money back. Read on for more information.
Refund Statistics
While new regulations aim to improve outcomes for scam victims, not all cases result in refunds. In 2022, banks reimbursed just 59% of losses caused by APP fraud, leaving many victims out of pocket. With the new rules, this figure is expected to rise significantly, providing better protection for customers.
How Long Will It Take to Get a Refund?
Banks are now required to reimburse eligible scam victims within five working days of being notified about the fraud. The process generally works as follows:
Report the Fraud: Notify your bank immediately about the scam.
Investigation: The bank will investigate the details of the fraud to determine eligibility for a refund.
Refund Decision: If eligible, you should receive your refund within 5 working days.
Appeal: If your bank rejects your claim, you can take your case to a fraud recovery service like CEL. We have years of experience – recovering over £100 million for victims of fraud.
Some refunds may take longer depending on the complexity of the case, especially if law enforcement or other banks are involved.
Do Banks Recover Money from Scammers?
In some cases, banks can recover money from scammers, but this is often challenging. Once the money has been transferred, fraudsters quickly move it to multiple accounts or withdraw it, making it harder to trace.
However, banks do have tools to attempt recovery, including:
- Recalling Payments: Banks can contact the receiving bank to freeze the funds before they are moved.
- Collaboration with Law Enforcement: Banks may work with the police or fraud agencies to trace and recover stolen money.
For example, in a notable case in 2023, a UK bank managed to recover £25,000 for a victim after promptly freezing the fraudulent account. While such successes are rare, they highlight the importance of reporting scams quickly.
Can I Claim All My Scammed Funds Back?
The initial limit was set at £415,000 but was later reduced following pressure from the financial services industry. The PSR stated that a higher limit could discourage investment and potentially hinder competition and innovation in the market.
If you’ve lost money to a scam, report the incident immediately and provide as much evidence as possible to support your claim.
How Do I Make a Claim?
If you’ve been scammed, follow these steps to make a refund claim with your bank:
Contact Your Bank: Notify them about the scam as soon as possible. Most banks have dedicated fraud teams available 24/7.
Provide Evidence: Gather all relevant evidence, including emails, texts, screenshots, and transaction details.
Complete a Claim: Your bank will guide you through the claims process, which may include filling out forms and answering questions about the incident.
Follow-up: Keep track of your case and follow up with your bank if necessary.
What if My Bank Rejects My Claim or Failed to Safeguard Me?
If your bank rejects your claim or you believe they failed to safeguard you from fraud, you still have options. Banks must protect customers by identifying suspicious transactions, issuing scam warnings, and preventing fraud wherever possible. If they’ve failed in these responsibilities, you may have grounds for further action. This is where we can help.
How CEL Solicitors Can Help
At CEL Solicitors, we are experts in dealing with scams, and we have helped countless victims reclaim their funds in cases where banks have denied refunds.
Expert Case Review: We’ll assess your case to determine whether your bank failed to protect you or unfairly rejected your claim.
Claims Management: Our experienced team will manage the entire claims process, negotiating with your bank to secure a refund.
No Win, No Fee: You don’t pay unless we successfully recover your funds.
Take Action Today
If you’ve been scammed and need help reclaiming your money, don’t wait—contact CEL Solicitors today. Fill out our online form or call us on 0330 822 3764 for a free consultation, and let us help you take the next step toward recovering your funds.
