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Can I claim compensation for Unauthorised Transaction Fraud?
There are rules for claiming a refund if you are a victim of unauthorised transaction fraud. Once the crime has been reported to the bank, you will not be liable for any further unauthorised payments from the account.
Industry watchdog, the Financial Conduct Authority (FCA), states on its website:
“If you didn’t authorise a payment, you should ask your bank for a refund. This refund should be in your account by the end of the next business day, along with any charges and interest you paid because of the transaction.
When you make your claim, your bank may ask you some questions and get you to fill out a form stating what happened. But it can’t delay your refund while it waits for you to return the form.”
A financial institution may decide not to issue a refund if they believe you authorised the payment(s), if you have been grossly negligent (for example, you gave someone your bank account login details), or if you deliberately made a false claim (which is fraud).
If the bank refuses to refund the money you lost or you disagree with their decision, you can complain to the Financial Ombudsman Service (FOS). FOS is an independent government backed organisation that investigates disputes between financial organisations regulated by the FCA and their customers.
FOS conducts wide-ranging investigations relating to both authorised and unauthorised payment fraud. It has ruled in favour of many customers who have been victims of scams, including impersonation scams.
What is Unauthorised Transaction Fraud?
Unauthorised transaction fraud occurs when scammers obtain confidential information about bank accounts and use it to access the victim’s money.
Here are some common ways fraudsters access bank accounts:
- Mobile phone or debit card theft
- Inadvertently sharing a PIN, One Time Passcode (OTP) or password
- Phishing activity, where someone collects personal and sensitive information about you, including login details
- Downloading software that gives third-party access to a phone or computer, including the apps and programs on it
Once a scammer has access to their victim’s funds, they can make online purchases, transfer money to another account (in the scammer’s control) or even take out a loan in the victim’s name, including using an overdraft facility.
Unauthorised transaction fraud often involves impersonation, where the scammer pretends to be calling or messaging from a trusted organisation, such as a bank, building society or utility company. The scammer may already have access to some limited personal information, which adds credibility to their story, making the unwitting victim more likely to divulge even more details.
For example, the scammer may use scare tactics, claiming that there has been a security breach or that they need to confirm the account holder’s identity. The unsuspecting victim gives the information they are asked for without realising that the fraudster now has everything they need to add a new device to their account, giving the scammer ongoing access from their own phone or computer.
As soon as the scammer gains access to a bank account, they begin making transactions, often small to begin with, then increasing in frequency and amount. Banks’ fraud detection systems are set up to detect unusual activity on accounts, such as transfers to new payees, repeated transfers to an account, large one-off payments or overseas payments. The fraudsters know this and try to avoid detection. It is not unusual for 10-20 payments to be made within just a few hours.
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What should I do if I think I have been the victim of an Unauthorised Transaction Fraud?
Immediately, contact your bank, the police and Action Fraud, the National Fraud and Cyber Crime Reporting Centre.
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TLW Solicitors can help
The legal specialists at TLW Solicitors understand the Financial Ombudsman Service claims and appeals processes, the information needed, and the time limits to be followed, ensuring that clients receive the compensation they are rightfully owed.
The combination of our experienced team and digital case management systems means that we proactively pursue your claim and aim to get the best possible results.
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What is the process for getting my money back?
We work on a ‘no-win, no-fee’ basis and offer a free, no-obligation initial assessment of your case. If we decide you have a claim, we will deal with it from start to finish, using our up to date case management system to actively pursue your refund claim and keep you informed at every stage in jargon free plain English.
The steps in the claims process are:
- Submit your claim to us by completing the one of our contact forms or getting in touch with us by telephone or email.
- One of our fraud experts will review your claim and determine if we can assist. If so, we’ll send you a welcome pack with all the information you need, including the details you’ll need to send us.
- Upon receipt of the information, a dedicated case handler will assess whether you have a valid claim and promptly guide you through the next steps. (Should your claim be unviable, our case handler will explain why and suggest alternative options).
- Your case handler will then progress your claim, gathering further information as required. They will liaise with the banks on your behalf, and you will receive regular updates at the milestone stages of the case or if we need more information from you.
- Claiming a refund can take several months, but rest assured, we will actively advance your claim. If you have any questions or concerns, you can contact your case handler.
- With our ‘no-win, no-fee’ policy, you pay nothing if your claim doesn’t succeed.
What will it cost to make a claim to the Financial Ombudsman Service?
It will cost you nothing to enquire. Once our team has reviewed your case and if we feel it is suitable, we will enter into a ‘no-win, no-fee’ agreement. If the case is unsuccessful, we will not charge for the time spent on it. If you, a friend, or a relative has lost money through unauthorised activity on your bank account, please contact our specialist team for a confidential, no-obligation conversation.
