The Lending Standards Board has changed its Contingent Reimbursement Model (CRM) Code to stamp out Authorised Push Payment (APP) scams.
LSB signatory firms will be required by December 2023 to step up their role in identifying suspicious inbound payments and accounts used by scammers.
LSB CEO Emma Lovell said: “It is essential that firms do all they can to stop criminals from opening bank accounts and using their services to receive scam payments.”
The CRM Code was launched in 2019 and requires signatory firms to detect, tackle and stop APP scams. LSB and the Payments Systems Regulator (PSR) signed a Memorandum in October 2022 to reaffirm their cooperation in combating fraud.
PSR is separately considering a proposal whereby firms must reimburse victims who have lost more than £100 in APP scams.
Lovell noted: “We share the PSR’s drive to ensure more victims are reimbursed where they are not to blame for the success of a scam”. However, LSB CEO reiterated that firms should prioritise fraud detection and prevention alongside reimbursement.”
“Reimbursement can repair the financial impact on the victim, but it is still very much a lose, lose outcome. Victims lose because they will feel the after-effects and trauma of being scammed even after reimbursement and society loses as organised criminals reap the rewards of theft”.