We have set out the next stages of our work to better protect people from authorised push payment (APP) scams.

In particular, this paper confirms the steps we will take to facilitate the design and implementation of an industry code to protect people from authorised push payment (APP) scams. This code will then set out the rules for a contingent reimbursement model.


APP scams – where people are tricked into sending money to a fraudster – are crimes that can have a devastating effect on victims.

They are the second biggest type of payment fraud reported by UK Finance, in both the number of scams and the total value involved (behind card fraud).

We are leading a package of work to protect people from these scams and make a positive difference. We want to make it harder for criminals to perpetrate these scams but, if they are successful, improve the experience for victims and improve the chances of returning money to them. We believe a contingent reimbursement model (CRM) is an effective way to do this.

We have consulted on this and set out the next steps in this document. 

What have we decided?

In November 2017, we published an update on our work to tackle payment scams, including a consultation on a contingent reimbursement model.

We received support from consumer groups and many industry players to develop better protections for consumers and a contingent reimbursement model.

We have decided to establish a collaborative steering group made up of balanced representation from the industry and consumer groups to design and implement an industry code for reimbursement of APP scam victims.

We have appointed a chair to lead the steering group, Ruth Evans, who is independent of payment industry interests and will be directly accountable to us.

An industry code, available from September 2018, can then be taken into account by the Financial Ombudsman Service as relevant considerations when determining complaints made by future victims of APP scams.

Following a final round of consultations, the Steering Group should have the industry code in place by early 2019.

What’s a contingent reimbursement model?

A contingent reimbursement model sets out the circumstances when payment service providers (PSPs) would be responsible for reimbursing APP scam victims that have acted appropriately. A contingent reimbursement model should establish better incentives for PSPs to use the measures being developed that help prevent and respond to APP scams, and for consumers to remain vigilant.

Why we believe this is the best course of action

We believe that an industry code, developed collaboratively by industry and consumer group representatives, will promote the interests of users of payment system services and reduce the consumer harm that APP scams can cause.

UK Finance’s Best Practice Standards for responding to APP scams

In November 2017, we also consulted on whether UK Finance’s Best Practice Standards for responding to APP scams would be effective to address the issues we identified so we can consider if any chances should be made to them.

Taking account of responses to our consultation, we believe it is not necessary to make changes to the Best Practice Standards at this time.

What are the next steps?

The APP Scams Steering Group published its draft code for consultation on 28 September. The consultation is open for feedback until 15 November with the intention of the code being finalised in early 2019. 

The PSR has also confirmed it plans to consult by December 2018 on using its regulatory powers to give a General Direction to banks and payment service providers to implement confirmation of payee - an important tool for preventing APP scams.

The proposed direction would require banks and payment service providers that are participants in the Faster Payments System to:

  • Be capable of receiving and responding to confirmation of payee requests from other PSPs by 1 April 2019
  • Send confirmation of payee requests and present responses to their customers by 1 July 2019
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