Financial institutions are granted an extended period of 72 hours to scrutinize questionable transactions.
From October 7, 2023, banks in the UK will take significant steps to protect customers from Authorised Push Payment (APP) fraud. These new measures, part of a broader effort to ramp up fraud prevention announced on October 3, 2023, aim to safeguard vulnerable communities and ordinary people from falling victim to such scams.
Under the new rules, banks will be required to refund APP fraud victims for losses of up to £85,000. This is a significant shift from current practices, where banks can choose whether to refund victims based on how much attention they paid to warnings. The refund must be processed within five days.
Banks will also have the power to delay suspicious payments for an additional 72 hours, increasing the maximum delay to four days. However, they will need to have reasonable grounds to suspect a payment is fraudulent before triggering a delay.
Tulip Siddiq, economic secretary to the Treasury, stated, "The new rules are aimed at protecting vulnerable communities and ordinary people from fraud." The Payment Services Regulator (PSR) has also confirmed new protections for victims of APP fraud, bringing compensation in line with that offered by the Financial Services Compensation Scheme.
Common types of fraud in the UK include romance scams, investment scams, pension scams, ticket scams, and trusted organization scams. Romance scams involve fraudsters forging emotional relationships to extract money or personal information. Investment scams lure victims with promises of high returns through fake or misleading investment opportunities. Pension scams trick people into transferring or investing their pension savings into fraudulent schemes. Ticket scams target consumers buying tickets for concerts or sporting events, particularly on online ticketing platforms. Trusted organization scams see scammers posing as representatives from government bodies, charities, or well-known businesses to deceive victims into sharing sensitive information or making payments.
Ben Donaldson, managing director of economic crime at UK Finance, believes the new rules will help consumers avoid being coerced by criminals who want to steal their money. He recommends "taking five" to stop fraud, which means stopping to research and take your time before acting.
The new rules will give payment service providers time to contact customers and offer advice to avoid being scammed. Over 99% of APP claims will be covered by the reimbursement cap.
Non-corporate fraud, including phishing and identity theft, is the most common fraud type by number in the UK, representing about 41% of cases reported in 2024. Most scams occur online, including via phishing emails, online shopping sites, and social media marketplaces like Facebook. The overall value of reported fraud fell in 2024, though the number of cases remains high.
UK authorities are stepping up responses, including new legal frameworks such as the "Failure to Prevent Fraud" offence effective September 2025 for corporate liability in fraud prevention. Victims often suffer significant financial loss, and many recover nothing—around 40% of victims report no recovery from an average loss of £765, with regional variations in average loss amounts.
These new measures mark a significant step forward in the UK's fight against fraud. As more and more transactions move online, it is crucial that consumers are protected from the various types of scams that proliferate in this digital landscape. By taking the time to research and verify before acting, consumers can significantly reduce their risk of becoming victims of fraud.
- Under the new rules, a refund must be processed within five days for victims of Authorised Push Payment (APP) fraud who have lost up to £85,000, a significant shift from current practices.
- Tulip Siddiq, economic secretary to the Treasury, confirmed that the new rules aim to protect vulnerable communities and ordinary people from fraud, including pension scams, romance scams, and investment scams.
- To help consumers avoid falling victim to scams, UK authorities are strengthening their responses, such as introducing a "Failure to Prevent Fraud" offence effective September 2025, and encouraging people to "take five" before acting, stopping to research and verify before making any transactions.
