Banks: Authorised Push Payment Fraud

Lord Sharkey Excerpts

Thursday 11th June 2020 Lords Chamber

[Baroness Penn]

I believe that the regulator has sufficient powers. However, the voluntary code is just over a year old. There will be a review of the operation of that code by the end of the year and, should that review reveal that further powers are necessary, of course the Government would consider the case for that.

[Lord Sharkey (LD) [V]]

My Lords, in February, the PSR allowed banks a three-month delay in implementing the sensible and effective confirmation-of-payee rule. One of the conditions attached to this delay was that customers were not to be disadvantaged. It is very hard to see how that would be possible, since we know the new rule to be effective in reducing scams. How will we know whether the banks have observed this condition and, if they have not, what sanctions will be applied?

[Baroness Penn]

The implementation of this is monitored by the regulator, and it will be responsible for ensuring that banks comply with that condition. Should anyone have needed to delay confirmation of payment and suffered fraud as a consequence, they will be fully compensated for it.