Authorised Push Payment Code: one year on

Authorised Push Payment fraud (APP), also known as bank transfer fraud, can be devastating to its victims. As well as potentially life-changing financial losses, the social engineering associated with this insidious crime can leave people feeling abused and exploited. Criminals will often isolate the victim from their friends and family, persuade them that law enforcement is corrupt and emotionally manipulate them before persuading them to part with their money. During the current pandemic criminals have had no shame in playing on people's fear and confusion by using the ?hook? of Covid-19 to draw in their victims.

To help protect customers and tackle this fraud, the APP Contingent Reimbursement Model Voluntary Code was launched on 28 May 2019 as a result of joint work between Payment Service Providers (PSP) and consumer groups. Since its introduction we have seen nine PSPs sign up, which represents over 90 per cent of the market in payment volumes. The Code provides a new standard of protection for customers against APP fraud, with signatory PSPs committing to reimbursing victims provided they have met the standards expected of them under the Code. Crucially, this has resulted in reimbursements for victims more than doubling. Work continues with the Lending Standards Board (LSB), which has responsibility for the Code, to increase the number of PSPs that have signed up. The LSB is undertaking a full review of the Code starting later this year.

Innocent and vulnerable victims should rightly be reimbursed, but the ultimate purpose of the Code is to encourage good practice in the payments industry and amongst customers to try and prevent these types of frauds happening in the first place. The Take Five to Stop Fraud campaign continues to drive home the message that people should ?Stop, Challenge, Protect? when asked for their personal or financial details or their money. Meanwhile our Dedicated Card and Payment Crime Unit (DCPCU) continues to tackle the criminal gangs responsible for these crimes and has recently seen successes in targeting those seeking to take advantage of Covid-19. 

But these types of crimes are not just a problem for the banking industry to solve. Government, regulators and other sectors need to step up and play their part. That includes those organisations not directly involved in the payment but who may have facilitated the fraud happening - for example through a data breach, or by carrying fake adverts on their platforms.  The pandemic has taught us how much can be achieved in a short space of time through a willingness to collaborate. Let's hope we can build on this learning so that this time next year there is even more reason to celebrate the Code's impact in galvanising action against this most invasive of frauds.

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