Bank payments could be delayed by FOUR days under new anti-fraud rules coming in this month

BANK payments for millions of customers could be paused by up to four days as part of a crackdown on fraudsters.

Banks and building societies currently have up to the end of the next business day to process or decline a transfer.

But under new Government legislation coming into effect at the end of the month, this will be extended by an extra 72 hours.

It will give banks more time to investigate potentially fraudulent activity that can see customers scammed out of their hard-earned cash.

It comes as Government figures reveal an estimated £460million was lost to fraud just last year.

Tulip Siddiq, economic secretary to the Treasury, said: “Hundreds of millions of pounds are lost to scammers each year, targeting vulnerable communities and ruining the lives of ordinary people.

“We need to protect these people better, which is why we are giving banks more time to investigate suspicious payments and break the criminal spell that scammers weave.”

The new law will better protect a growing number of vulnerable customers targeted by purchase and “romance” scams.

These scams see victims targeted and tricked into transferring large amounts of money.

Ben Donaldson, UK Finance managing director of economic crime, said it was “delighted” to see the new legislation put forward.

He added: “This could allow payment service providers time to get in touch with customers and give them the advice and support they need to avoid being coerced by the criminals who want to steal their money.

“This could potentially limit the psychological harms that these awful crimes can cause and stop money getting into the hands of criminals.”

Under the new rules, banks who believe a customer could be scammed will need to tell them if their payment is being delayed.

They will also have to explain to the customer what they need to do to unblock any payments and compensate them for any interest or late payment fees they receive because of any delays.

Rocio Concha, director of policy and advocacy from Which?, said the new law was a “positive step in the fight against fraud”.

“While it should not affect the vast majority of everyday payments, it’s important that banks can delay a bank transfer and take action if they think a customer is being targeted by a scam.”

The new rules on extending the time banks have to investigate fraudulent transfers will come in just weeks after the introduction of a fresh scheme on fraud compensation.

UK banks currently don’t have to compensate customers who have been scammed out of money.

However, from next Monday (October 7), refunds up to a cap of £85,000 will become compulsory.

Nicola Bannister, customer support direct at TSB, said the bank welcomed the new rules coming into force.

She added: “Social media and telephone companies must now work tirelessly to cut fraud off at source and protect their users from scam content.”

How to protect yourself from fraud

While the Government’s new law will go some way to protecting customers from being scammed, there are other steps you can take to avoid being conned out of cash, according to Action Fraud.

First, never give out any personal information including your name, address, bank details, email or phone number, to organisations before checking they are legitimate.

And always think twice when receiving an unsolicited call, text or email requesting these types of details.

Instead, contact the company directly using a known email or phone number.

Second, make sure your computer, laptop and phone has up-to-date anti-virus software installed which will block any malware.

Third, always keep an eye out for phishing emails or texts which pretend to be legitimate but are designed to steal your personal information.

These messages usually come with a link which, if clicked on, can see your personal information including bank details stolen.

Fourth, be wary of post, phone calls or emails offering you business deals out of the blue.

If an offer seems too good to be true, it probably is, so always question it.