Tech firms must help refund victims of fraud, says HSBC

HSBC has thrown its weight behind calls for tech firms to pay up for fraud, saying incoming compensation rules requiring banks to reimburse scam victims up to £85,000 will fail to stem the flow of fraud, and prove that the financial sector is not the problem.

- Kalyeena Makortoff

David Callington, the head of fraud at HSBC UK, said rules coming into force on 7 October would motivate banks and payment firms to improve their fraud detection systems but that would not be enough to shift the dial and curb scam cases across the UK.

City lobby groups have long complained that members have been left to shoulder the costs of fraud against their customers, despite a surge in the number of scammers targeting consumers through online platforms and social media. They say the vast majority of authorised push payment (APP) scams, in which people are tricked into sending money to accounts operated by criminals, are facilitated by text messages or by fake online ads on platforms such as Instagram, Google, TikTok or Facebook Marketplace.

APP fraud losses amounted to £459.7m in 2023 and the total number of cases increased to 232,429, according to data published by the banking body UK Finance.