APP fraud sees criminals trick people into willingly transferring money to the fraudsters’ account, often through impersonation.
The Guernsey Financial Services Commission is working with the Isle of Man Financial Services Authority and the Jersey Financial Services Commission to encourage banks to adopt a consistent approach.
A new framework they have together put forward reflects high level principles and areas of common direction between the Crown Dependency financial services regulators.
‘We are aligned on the benefits of a practical pan-Crown Dependency approach to APP fraud,' said a GFSC spokesman.
'The aim of the framework is to support a coordinated and broadly consistent approach across the Crown Dependencies, while recognising jurisdictional differences where relevant.'
The regulators have agreed that a detailed definition, including the boundary with unauthorised fraud and other payment and fraud scenarios, will need to be developed and tested further to ensure clarity and consistent treatment.
This will also involve industry, government and the financial services ombudsman for each island.
The GFSC said that it had been agreed that the focus should be on retail banking and sterling payments, with the aim of the joint engagement being to deliver consistent customer outcomes and clear handling of such cases and related complaints, and clear expectations of how banks should respond when suspected fraud is reported.
The regulators have also considered how defrauded individuals should be reimbursed, if appropriate, or when that should be refused.
The idea of sharing the costs between banks has been rejected as operationally complex, and it is not being treated as the starting point for the framework.
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