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Scamdemic protection: call a journalist

In the Scamdemic, investigations by journalists are a source of inspiration by helping many clients receive compensation from banks who initially refused fraud reimbursement. At the point of banks saying no to a rebate, the bank scam team trot out with the excuse of their standard lines , ‘We contacted the payee bank and were unable to recover funds or take action against the bank. These payments don’t offer any form of protection and were carried out in line with your instructions, therefore, there will be no rebate.’

The Sunday Times persuaded a large bank to reimburse £230,000 to an 88-year-old couple, one of which has dementia, who had refused them a rebate.   Notably, the FCA want banks to protect vulnerable people. 

Turns out the scam was turned down by another large bank, reflecting the lack of collaboration amongst the banks against fraudsters.  The scammers then convinced the victim to open a new bank account, from which, the money was sent. The initial and ongoing KYC (know your customer) taken by the second bank is questionable. 

On making the reimbursement, the bank advised the couple on  a call-screening service so fraudsters cannot get through, as well as, setting up a power of attorney for vulnerable people. 

Demands on The Police, Banks, Payment Providers and the clients are overwhelmed by the volume of scams. Scam victims accounted for 224,000 cases in 2020 up 34% year-on-year. At this rate, by 2023, there could be 500,000 victims per year doubling the volume.

The Police, for example from April 2020 to March 2021 reported the 44 UK Police Forces handled 26,000 cases covering £161 million in losses, with 4 handled 64% of the fraud losses. Not surprising, as it is the traditional big cities that dominate – Greater London, Greater Manchester and West Midlands (Birmingham) but fraudsters are now everywhere.

UKFinance reported for the year 2020 fraud totalled £1,260 million. The Police investigated 15% of the actual cases leaving 85% to be resolved by others.  Well, on discovering a fraud, the bank is the first to be called.

The banks are also overwhelmed. Even getting through to them, when in a highly emotional state, during COVID, has been challenging. The banks themselves have their own unique approach in handling the scams. The results that journalists are finding, are exceedingly against the bank customer with decisions given with little empathy. Only 40% of defrauded clients receive a rebate with the majority losing their money.

After the banks’ negative decisions, the next step for the victim is the Financial Ombudsman Service.  This is often a long and emotional charged process. At the end of the process, half of the banks’ decisions have been reversed. The traditional banks also have between 50 to 70% of their negative decisions reversed.

The number of scams are set to go to even higher as banks and payment providers plan to make cross border payments instant. Ironically, automating the final stage in the fraudsters UK scamming process, makes it much easier and faster for them to scam.

Without changing the traditional processes towards online frauds, journalists will be in much greater demand to arbitrate between the bank, their clients and Society.

 

 

 

Police Fraud Cases in 2020-2011
1133

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John Bertrand

John Bertrand

MD

Tec 8 Limited

Member since

03 Apr 2020

Location

London

Blog posts

14

This post is from a series of posts in the group:

Exposing Financial Crime

Criminals are smart, and detection capabilities need to be smarter and always adapting to stay one step ahead. Time to drive out pointless investigations and finding true malignancies hidden from existing rules and machine learning techniques. Join us for conversations and articles on how to refocus financial crimes investigations into actually stopping crime.


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