Parminder got a call from someone who said they were from his bank and phoning because there’d been some odd-looking payments leaving his account.
This case study was developed with the help of the Payment System Regulator, to illustrate the FPS and CHAPS reimbursement rules.
What happened
Parminder got a call from someone who said they were from his bank and were phoning because there’d been some odd-looking payments leaving his account.
Parminder logged onto his online banking but couldn’t see anything unusual. He asked the caller to prove he was from the bank. The caller told him to look at his texts, which he did and found one that seemed to confirm the caller’s identity.
The caller then told Parminder there was a problem with his account and he needed to move his money to a safe account. Parminder did as he was told but during the payment process a message came up. It warned him that fraudsters impersonate other people and can trick you into parting with your money.
Next to the warning at the top of his screen was a green button that said “Continue”. Parminder clicked on it and so, authorised the payment.
When he discovered he’d been scammed and complained to his bank, they referred him to this warning. They also mentioned an email they’d sent months before with information on common scams. Parminder didn’t remember the email, but the bank told him it said:
“Fraudsters will impersonate others – including your PSP. They can even appear to be calling from our actual telephone number. We’ll never ask you to move money to a ‘safe account’. If you receive a call asking you to do this, hang up the phone.”
Assessment under the FPS and CHAPS reimbursement rules
Parminder received a warning message when he was about to make the payment, but it doesn’t meet the requirements under the FPS and CHAPS reimbursement rules. It isn’t specific to the scam he fell victim to and is common to every payment journey.
The earlier warning, that was emailed to Parminder, arrived a long time before the scam took place. So it wasn’t specific to the transaction – or series of transactions – that were part of the same scam. It was also a ‘passive warning’ because it was sent in an email and not brought directly to Parminder’s attention.
Because neither intervention meets the minimum standard under the FPS and CHAPS reimbursement rules, the bank can’t decline to reimburse him.