Do Banks Refund Scammed Money?
We’re often asked, do banks refund scammed money? Unfortunately, this is no simple answer and the response from banks can vary greatly from country to country and even bank to bank. Scams are a growing concern in Australia, with the Australian Competition and Consumer Commission (ACCC) reporting Australians lost a record $3.1 billion to scams in 2022. Although some countries like the UK have laws requiring banks to refund scam victims Australia has no such laws.
Australian Advocates and consumer groups have been calling on the government to adopt better protections for scam victims and require banks to refund scam victims. The ACCC has stated that banks should reimburse scam victims. However, reports from the ABC stated that Australian banks reimburse less than 5 per cent of scam victims.
Will Banks in the UK Refund Scammed Money?
The UK government introduced laws requiring banks to refund scam victims who made payments on or after 7 October 2024. These laws make UK banks responsible for protecting their customers’ money and requiring them to reimburse up to £85,000. The Financial Conduct Authority (FCA) has ordered UK banks to reimburse customers who have been tricked by authorised push payment (APP) scams.
However, the process of getting a refund in the UK is not always straightforward, and certain requirements must be met before a refund can be issued. Customers must have taken reasonable care to protect themselves from the scam and reported the fraud promptly. The bank will then investigate the matter and determine if a refund is possible.
Some banks have implemented £100 excess on refund claims but this is not the case for all of the banks. It’s important to understand your bank’s procedures and policies around this process as it will have an impact on how easy it is to get your money back and under what circumstances they will be required to issue a refund.
As mentioned these laws apply to authorised push payment scams so depending on the type of scam it may not always be possible to get the bank to reimburse the funds. Understanding these laws and what scams they apply to will give victims the best chance of being reimbursed. Have a look at the FCA report on the new laws for more information.
Will Banks in Australia Refund Scammed Money?
In Australia, things work differently, banks are encouraged though not required to have a code of practice for dealing with scams but this is not legally binding. The Australian Banking Association provides information on how to protect yourself from scams and what to do if you think you have been scammed.
While there are no laws in Australia requiring banks to reimburse scam victims, some banks do have policies in place regarding reimbursement of customers who have fallen victim to certain types of scams. It is important to check what policies if any the bank has regarding refunds and what requirements must be met to qualify for a refund.
According to the community legal centre Financial Rights Legal Centre, there are some circumstances where banks are required by law to issue a refund. The laws predominantly cover card transactions and relate to things like unauthorised transactions, cancelled recurring transactions and merchants not delivering the goods or services.
By understanding the relevant government laws, bank policies and the nature of the incident or scam that has occurred consumers have the best chance of having their funds returned.
How To Protect Yourself From Scams
Ultimately the best option is to avoid scams in the first place though this is much easier said than done. Remaining vigilant and taking steps to protect oneself online will reduce the chances of fraud, always take time to understand to whom the money is being sent and if this information is not available this may be a sign of a scam.
Being cautious about sharing personal information online will help users stay safe and reporting any suspicious activity can help protect other users. The Australian and UK governments have online resources to help protect users from scams. Understanding how scams work and how to spot a scam can go a long way to protecting yourself from scammers. Cybertace has many free online resources to help consumers stay safe, check out our blogs, scam warnings and online tools for more information, you can also report scams online through our online reporting tools.
How can Cybertrace help?
If you have been the victim of a scam facilitated through a bank in Australia a private cyber investigations firm like Cybertrace can act quickly to investigate the incident and collect evidence. It is important to capture evidence while it is still fresh, however, most financial institutions and law enforcement agencies are overwhelmed with scam reports and in many situations, it can take up to 12 months to arrive at any level of resolution.
By engaging Cybertrace to investigate your case and identify evidence and intelligence as quickly as possible the results can be escalated through financial institutions or law enforcement in a more timely manner.
By identifying the nature of the scam Cybertrace can assist victims in understanding the best path to take to recover funds, whether that involves pursuing a refund from the bank, gaining assistance from law enforcement or going after the criminals directly.
For victims in the UK, we can also assist with Authorised Push Payment (APP) investigations and guide you through the refund process via the correct channels. For further reading, please refer to our Authorised Push Payment (APP) blog or contact our team of investigators for advice.
Cybertrace is here to help, so if you think you have been the victim of a scam or if you have questions about recovering stolen funds reach out to one of our scam specialists today.
I was scammed 2 years ago got no money back from the bank. Reported it to the police. I also went on the Abc program 7.30 report. But no help or money back.
I am 76 years old , I lost $260000. All my life saving
Hi Doris,
Our team has reached out via email.
I have been scammed by an insane amount of money ($500k)
This would not have happened if the receiving bank would display the (receiving) account holder; like in PayID
Hi Eugen, we will be reaching out to you in relation to this. If you don’t hear from us, please submit a contact form – https://www.cybertrace.com.au/submit-contact-form/