Thousands of customers who flagged fraudulent transactions to their bank were wrongly denied their money back, according to a new investigation.
Consumer group Which? looked into complaints sent to the Financial Ombudsman Service (FOS) between April 2015 and February 2017 after banks had refused to refund customers who spotted potential fraud on their account.
Across nine of the UK’s biggest high street banks Which? looked at almost 5,000 appeals sent to the Ombudsman, with 27% of cases upheld in favour of the consumer.
With the average amount lost in fraudulent activity estimated to be up to £600, it means as much as £784,000 could have been returned.
Santander, Nationwide and RBS were all guilty of incorrectly denying more than a quarter of complainants the money they were rightfully owed.
For customers of NatWest, Bank of Scotland, Lloyds, HSBC & TSB at least a fifth of cases were upheld in their favour.
Banks are legally obliged to compensate customers if they report a fraudulent transaction within 13 months of it occurring and they were not negligent with their debit or credit card.
These figures make up just part of the compensation and fines paid out by the UK’s big banks which according to research has totalled £66.5bn since 2011.
Making up the majority of the compensation paid out is the Payment Protection Insurance (PPI) mis-selling scandal.
More than £26.7bn has already been refunded to UK consumers who have complained about the way in which they were mis-sold PPI according to the Financial Conduct Authority (FCA).
It is estimated that £50bn worth of PPI policies were sold in total in the UK over the past 10-15 years, showing almost half that amount still remains unclaimed.
Intending to bring an end to the PPI saga a deadline was set by the industry watchdog, but has since been criticised by consumer groups and commentators who are concerned that many will miss out on their chance to claim.
With the FCA themselves estimating that as many as 30m consumers with up to 64m policies could have been affected, and 90%* of our successful customers unsure if they had PPI before they checked with us, isn’t it time you found out for certain?
*As at December 2016