Bank lobby rewarded as fraud liability to be slashed
British banks’ investment in public affairs lobbying is set to generate a significant return, as the industry watchdog is predicted to substantially reduce their liability for reimbursing victims of fraud.
According to emerging media reports in The Times, The Guardian and Financial Times on Wednesday (4 September), the UK’s Payment Systems Regulator (PSR) is poised to slash bank’s liability by as much as 80 per cent in a major win for the banking industry.
The change relates to the amount that customers can claim back from their bank in instances where they fall victim to authorised push payment scams, which cost victims nearly £460m last year, according to UK Finance.
Historically, it has been on banks to make good on such fraudulent activities up to £415,000. It is reported that this amount could be reduced to £85,000 under the new proposals.
Attention will now turn to a much-anticipated official announcement from the PSR which is scheduled for this week, as to whether the proposals will be put out to consultation ahead of the rules being redrawn.
The PSR published an update on LinkedIn last week stating that it was exploring “the outcome of our pre-implementation review of high value claims”.
Last month, Kate Fitzgerald, the PSR’s head of Policy published a paper stressing that the regulator has already led positive change in the industry by “increasing transparency [through] publishing data, promoting intelligence-sharing and expanding the roll-out of Confirmation of Payee.”
Confirmation of Payee is a name checking service which the industry believes will substantially reduce APP fraud in future.
To monitor any updates on this consultation, readers should consult the dedicated news channel on the PSR’s website, available here.