Huge moment in the fightback against financial fraud should be celebrated: Rocio Concha

And that doesn’t even include the flood of scams which begin online, on social media platforms or large search engines, which ensnare victims through paid-for advertising, promoting investment schemes purportedly promoted by ‘celebrities’ to add a veneer of plausibility.

The issue of APP fraud has persisted for years, and organisations including Which? have been sounding the alarm for all of that time - indeed we first made a landmark super-complaint to the financial regulator in 2016. But progress to clamp down on the scammers has been frustratingly slow.

The result has been the sharpening of tactics, meaning many fraud attempts have now become frighteningly sophisticated.

Which? has heard of scams which saw a fraudster infiltrate the email chain of a house purchase by pretending to be the buyer’s solicitor - stealing thousands sent in error. AI and new tools like ChatGP threaten to make the problem even worse.

The impact of fraud can have a devastating effect on victims that goes far beyond the financial. Those who have been ensnared talk of a loss of confidence and trust after the event, as well as feelings of humiliation, regret and despair.

Those feelings have been compounded by the behaviour of banks when it comes to returning the lost money.

Despite being at the frontline of fraud, banks have too often dragged their feet when it comes to reimbursement - preferring in some cases to blame the victim.

One unintended consequence of a voluntary code, which instructed banks to return money to APP victims who were not at fault and to which most major banks have signed up, has been a reimbursement lottery depending on who the victim banks with.

Encouragingly, that’s set to change soon. Recently announced requirements for payment service providers (now encompassing over 1,500 financial firms and not just the 10 or so banks who were signatories of the voluntary code) will result in mandatory reimbursement in all but exceptional cases - a big step towards incentivising firms to prevent fraud in the first place.

New rules will mean the vast majority of victims will now get their money back should they fall victim to APP fraud.

It’s a huge victory - and should lead to much fairer and more consistent outcomes.

Financial firms will also be obliged to publish data on reimbursement rates, which means consumers can see how well firms are doing and lifts the lid on a decision making process which has too often been too opaque.

With over £485 million lost to APP fraud in 2022, according to industry body UK Finance, we are not naive enough to think that these new reimbursement requirements will be sufficient alone to combat fraud, which is now the most commonly reported crime in England and Wales.

As I have written in these pages before, if we are to truly tackle the scourge of scams, then a range of actors, including online platforms, banks, telecoms providers, the government and law enforcement agencies will all have to work together. With around 80 per cent of scams originating online, tech giants must be given the legal responsibility, through the Online Safety Bill, to remove fraudulent posts on their sites.

Nevertheless, the recent announcement by the Payment Systems Regulator is a huge moment in the fightback against fraud - and it should be celebrated.