New fraud compensation rules do not apply to local bank accounts
NEW rules to guarantee compensation for victims of fraud will not apply to bank accounts held in Guernsey, but the local regulator has said it expected such matters to be dealt with ‘expeditiously’ by island-based payment service providers.
A new rule governing UK-based banks and PSPs is being brought in on 7 October by the UK’s Payment Systems Regulator, as a result of which fraud victims will be compensated up to a maximum of £85,000 within five days. After the refund is paid, the victim’s PSP can claim half of the compensation back from the fraudster’s.
But the PSR has clarified that the new rule will affect only accounts held in the UK.
‘Channel Islands customers would only be in scope of the reimbursement rules if they are a customer of a bank/PSP which is domiciled in the UK mainland – and where the account is held there,’ said a spokesman. 'Where a PSP is domiciled in the Channel Islands and/or the account is held there, the customer would be out of scope.’
He added that extending the rules to the islands would be something for local governments and regulators.
A spokeswoman for the Guernsey Financial Services Commission said that the Bailiwick of Guernsey did not have a mandatory reimbursement scheme for authorised push payment fraud, where large amounts of money are transferred from the victim’s bank.
However, ‘the commission expects all payment services providers to deal expeditiously with such matters and to take a lead in combatting crime in this area’, she said.
‘We are committed to fighting financial crime and fraud and we expect all the firms we supervise to act with due skill, care and diligence towards their customers and to deal with customer complaints in a thorough and prompt manner.’
