If the banks, the UK government and the EU are to be persuaded of the need to change the Faster Payments process then it is important to be clear about the nature of the current problem.
These two case studies show why the current process needs to be changed.
Jack was ‘phished’ and lost £59,000
The precise sequence of events that led up to Jack having most of his life savings stolen from his bank account remain unclear because his bank have refused to disclose exactly what happened between 8pm and 11pm that evening. But what we do know is that the fraudster duped both Jack and his bank, several new payees were created and £59,000 was transferred from Jack’s account to people that he didn’t know and hadn’t ever made payments to in the past.
By the following morning even the bank agreed that the phone call that unlocked the account and authorised the payments wasn’t made by Jack, but by then the money was far, far away and couldn’t be recovered.
Henry’s card was ‘lost’ and he lost £18,000
Following a celebratory evening in a club Henry ‘lost’ his card and, it appears, allowed his PIN to be compromised. The circumstances of the loss are not important, but what happened next certainly is.
During the course of the following 8 hours (while Henry was sleeping off his night out) the fraudster used the card and PIN to transfer £18,000 to a number of new payees that the fraudster had just created. By the time Henry woke up and phoned the bank to report his card missing the money was gone and couldn’t be recovered.
What Needs To Change?
In both of these cases a 24HourDelay between the creation of a new payee and payments being made to that payee would have prevented the loss. It is that simple.