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Bank transfer scams and when your bank must refund you
Saving & Budgeting Nov 08, 2025 10 min read

Bank transfer scams and when your bank must refund you

New UK rules mean most people who are tricked into sending money by bank transfer should now get a refund in many cases. This guide explains what counts as a bank transfer scam, when your bank has to refund you, when it can say no, and how to protect yourself.

Bank transfer scams have become one of the biggest fraud problems in the UK. Criminals persuade people to move money themselves to a fraudster, often by pretending to be a bank, the police, a seller or even a new partner.

Until recently, getting money back after this type of scam was hit and miss. Some banks refunded, others did not. New rules brought in by the Payment Systems Regulator (PSR) are designed to change that and give most victims a clear right to reimbursement.

This guide explains what those rules actually mean in practice.

What is a bank transfer scam

Banks and regulators call this type of fraud authorised push payment fraud, often shortened to APP fraud.

In simple terms, it is a scam where:

  • you are tricked into authorising a payment from your account
  • the money is sent by bank transfer to an account controlled by the criminal

Common examples described by MoneySavingExpert, UK Finance and the Financial Ombudsman Service include:

  • purchase scams where you pay for goods or services that do not exist
  • impersonation scams where the fraudster pretends to be your bank, the police or a known company and tells you to move money to a safe account
  • romance scams where someone builds a relationship online and then asks for money

See for example:

What has changed in how refunds work

On 7 October 2024 a new mandatory reimbursement requirement for APP fraud took effect in the UK Faster Payments system. This requirement is set by the Payment Systems Regulator.

Key points from the PSR and industry summaries:

  • The rules apply to in scope payment service providers that use Faster Payments, and also CHAPS in practice.
  • In scope providers must reimburse victims of APP scams in most cases where certain conditions are met.
  • The new framework sets a maximum reimbursement level of eighty five thousand pounds per case.
  • The cost of the refund is shared between the sending and receiving providers.

Sources and explainers:

MoneyHelper explains the practical impact for consumers. Its November 2024 update on bank transfer scams says most victims should now get a refund in five working days from their bank or payment provider, with possible limited deductions in some cases:

Consumer coverage and technical briefings summarise that:

  • Most personal customers and many small businesses are covered.
  • There is an upper reimbursement cap of eighty five thousand pounds per case.
  • Banks can apply an excess of up to one hundred pounds in some situations, although not for vulnerable customers, and several providers have chosen not to apply this excess.

When should your bank refund you

Under the new framework and guidance from MoneyHelper, Citizens Advice and the PSR, your bank or payment provider will usually be required to reimburse you if all of the following are true:

  1. You were the victim of an authorised push payment scam.

    • You genuinely believed you were sending money for a real reason, not trying to launder or hide money.

  2. The payment was made via a UK payment service covered by the scheme.

    • In practice this is usually a Faster Payments or CHAPS transfer from a UK account.

  3. You are an in scope customer.

    • For example a consumer, a small business or a charity under the limits set by the PSR.

  4. You reported the scam to your bank within the allowed time limit.

    • MoneyHelper and other sources highlight that under payment services rules you normally have up to thirteen months from when the payment left your account to raise a claim, although you should act as soon as you realise.

  5. You did not act with gross negligence or take part in the fraud.

    • Banks can refuse to reimburse if they can show you were involved in the scam or ignored very clear warnings that a reasonable person would have followed.

The detailed scheme rules are described in:

Citizens Advice gives a consumer friendly summary of when you are likely to get money back after a scam, including payments by bank transfer and the role of earlier voluntary codes for older cases:

When your bank can say no

Even under the new rules, reimbursement is not automatic in every single case.

Banks and building societies can refuse a refund if, for example:

  • you were knowingly involved in the fraud or trying to benefit from it
  • you deliberately ignored clear warnings from your bank that the payment was likely to be a scam
  • you unreasonably failed to take steps to keep your account and security details safe

Commentary on the scheme and legal articles explain that decisions will depend on the facts of each case, and that firms must take account of vulnerability and context rather than relying on rigid rules.

If you think a refusal is unfair, you can use the bank complaints process and then ask the Financial Ombudsman Service to review the case.

What about scams before the new rules

The PSR reimbursement requirement applies to APP fraud payments from October 2024 onwards.

For bank transfer scams before that date, many major banks followed a voluntary standard called the Contingent Reimbursement Model Code (CRM Code) from May 2019 to early October 2024. Under that code, firms committed to refund victims in many cases where the customer did everything a careful person could reasonably do.

Citizens Advice notes that:

  • if the fraud happened when your bank was signed up to the CRM Code, you may still have rights to a refund under that code, and
  • if your bank was not signed up, you can still complain and the Financial Ombudsman may decide what is fair and reasonable in your situation.

Details are on the Citizens Advice page about getting money back after a scam and on the Lending Standards Board website, which lists firms that signed the CRM Code.

What if the scam involved an overseas transfer or a money transfer service

The new mandatory rules focus on UK payment systems such as Faster Payments and CHAPS.

Citizens Advice and MoneyHelper both warn that it is often much harder to get money back if:

  • you sent it through a money transfer service such as Western Union or similar providers
  • it was an international transfer outside the UK regulated payment systems
  • you used methods such as vouchers or gift cards

In these cases your bank may have fewer options to recover funds. You should still report the scam to your bank, Action Fraud and the police, but you may need to focus on stopping further losses and getting support rather than expecting a refund.

Citizens Advice explains the differences clearly on its scam refund guidance page.

How big is the problem

UK Finance figures reported in 2025 show that in just the first half of 2025:

  • total fraud losses were around six hundred twenty nine million pounds
  • authorised push payment scams accounted for about two hundred fifty seven and a half million pounds of losses
  • the number of APP scam cases fell slightly, but the average amount per scam rose

Two thirds of APP scams started online, with a significant share via phone calls and messages.

These figures are summarised in MoneyWeek coverage of UK Finance fraud data:

What to do immediately if you realise you have been scammed

MoneyHelper, Citizens Advice, the FCA and Take Five all give similar urgent steps:

  1. Contact your bank straight away

    • Use the number on the back of your card or the official app or website.
    • Explain that you believe you have been the victim of an authorised push payment scam.
    • Ask them to try to recall the payment and to block any further suspicious activity.

  2. Report the scam

    • In England, Wales and Northern Ireland you can report to Action Fraud.
    • In Scotland you usually contact Police Scotland on the non emergency number.

  3. Keep records

    • Save text messages, emails, fake invoices, adverts and screenshots.
    • Note times and dates of calls and anything the scammer said.

  4. Change passwords and secure your devices

    • Follow FCA and National Cyber Security Centre advice to update passwords and enable multi factor authentication where possible.

  5. Look after your wellbeing

    • Being scammed is upsetting and often embarrassing, but it is a crime in which you are the victim. Citizens Advice and MoneyHelper both encourage people to seek emotional support as well as financial help.

Useful pages:

How to reduce your risk next time

Campaigns like Take Five and FCA guidance suggest a few practical habits:

  • Stop
    Take a moment before sending a large or urgent payment, especially if someone has contacted you out of the blue.

  • Challenge
    Ask yourself whether the contact makes sense. Your bank or the police will not ask you to move money to a safe account, and genuine companies will not pressure you to act instantly.

  • Protect
    Use strong, unique passwords, keep contact details up to date with your bank, and use confirmation of payee checks carefully. If the name your bank shows does not match the one you entered, treat that as a red flag.

Take Five has a clear introduction to these steps: https://www.takefive-stopfraud.org.uk/

The FCA also sets out common warning signs and what to do if you suspect a scam: https://www.fca.org.uk/consumers/protect-yourself-scams

If your bank still refuses to refund you

If you think your bank has applied the rules wrongly or treated you unfairly:

  1. Use the bank complaints process
    Set out what happened, why you think it was an APP scam, and why you believe you meet the conditions for reimbursement. Refer to the new APP fraud reimbursement rules where relevant.

  2. Give the bank up to eight weeks to respond
    This is the standard time limit for resolving complaints.

  3. Go to the Financial Ombudsman Service if needed
    If you are not satisfied after eight weeks, or you receive a final response you disagree with, you can take your complaint to the Ombudsman for free. The Ombudsman looks at what is fair and reasonable based on the rules, codes of practice and the facts of your case.

The Ombudsman can require a bank to refund you and pay compensation where it decides the bank has handled things wrongly.

Key points to remember

  • Bank transfer scams, also called authorised push payment fraud, involve you being tricked into sending money yourself to a criminal.
  • New rules from the Payment Systems Regulator mean that most people who are scammed through Faster Payments should now get a refund in most cases, up to a cap of eighty five thousand pounds per case, usually within five working days.
  • Banks can still refuse to pay if you were involved in the scam or acted with gross negligence, but they must take your circumstances into account, especially if you are vulnerable.
  • International transfers, some money transfer services and payments outside the covered systems may not benefit from the same protection.
  • If your bank says no and you believe that is unfair, you can complain and ask the Financial Ombudsman Service to look at the case.

Used with care, the new rules make paying by normal UK bank transfer much safer than it used to be, but the best defence is still to pause, challenge and double check before you move your money.

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