Source · Select Committees · Treasury Committee
Recommendation 25
25
Paragraph: 117
However, the pace of change has been very slow against a background of growing fraud,...
Conclusion
However, the pace of change has been very slow against a background of growing fraud, which should have prompted greater urgency. The super-complaint was made in 2016, and the previous Treasury Committee called for the Contingent Reimbursement Model Code to be made mandatory in 2019. Since then, nearly three years have passed, during which time authorised push payment fraud has increased, causing significant harm. The Payment Systems Regulator’s ‘Call for views’ was published in February 2021 and, although there is now a clear intention to make reimbursement mandatory, another year has been lost.
Paragraph Reference:
117
Government Response
Not Addressed
HM Government
Not Addressed
We recognise that there is still a lot of work to do to stop fraud from happening, to reduce APP scams, and improve consistency and coverage of protection of victims. In February 2021 we published a call for views on the nature and scale of the issues with the CRM Code. In this document we stated that levels of reimbursement vary materially across PSPs and, as participation in the code is voluntary, many customers fall outside the protections it offers. We also invited views on three complementary measures to prevent APP scams and improve outcomes for victims. We proposed to: • Require the 12 largest PSP groups in the UK (including most of the biggest high street brands) and the two next-largest PSPs in Northern Ireland to publish comparative data on: Ȥ their APP scams reimbursement levels for customers who are APP scam victims Ȥ which PSPs their fraudulent payments have been sent to This means that, for the first time, customers will be able to understand how well their PSP is preventing APP scams and treating victims, and which PSPs are receiving these fraudulent payments. • Support and require industry to improve intelligence sharing, to improve detection and prevention of APP scams. • Make reimbursement for scam victims mandatory. While we do not have the powers to do this at present, we welcomed the announcement from John Glen MP, Economic Secretary to the Treasury, that the government will legislate to address any barriers to regulatory action at the earliest opportunity. We continue to work to ensure that we can act quickly once this legislative barrier is removed. In addition to the above three proposals, we continue to look at other ways of preventing APP scams and reimbursing victims. This includes looking at how the PSR, Pay.UK, and industry could implement rules (for example, in Faster Payments) within the parameters of existing legislation, and wider adoption of existing measures such as Request to Pay and the Biller Update Service.