Good News for Banks

[monabri]

https://www.telegraph.co.uk/money/consu ... rt-ruling/

"Banks cannot be held responsible for fraudulent payments that are authorised by customers themselves, the Supreme Court has ruled".

"Barclays has won a landmark legal ruling that banks are not liable for fraudulent transactions that have been requested by account holders, in a case that threatened to spark a flurry of claims from fraud victims had the bank lost."

"The Bank faced a compensation claim from a music teacher Fiona Philipp who, along with her husband, Robin, was tricked in an Authorised Push Payment or “APP” scam into sending their life savings – £700,000 held in a Barclays account – to a fraudster’s bank in the United Arab Emirates."

"The case, which was first brought against Barclays in 2020, was thrown out at the commercial court in Bristol in 2021. But that decision was overturned by the Court of Appeal last year, before lawyers for Barclays lodged an appeal with the Supreme Court.The bank’s appeal was unanimously upheld by the Supreme Court on Wednesday."

If folk don't check where they are sending (large sums of) money to, why should a third party (the bank) by held responsible ?

[XFool]

https://www.telegraph.co.uk/money/consumer-affairs/blow-for-bank-fraud-victims-supreme-court-ruling/

"Banks cannot be held responsible for fraudulent payments that are authorised by customers themselves, the Supreme Court has ruled".

If folk don't check where they are sending (large sums of) money to, why should a third party (the bank) by held responsible ?

Harsh but fair?

I confess this has been bothering me. Why should banks (i.e. other customers or shareholders) pay for the errors of others? If you are a capable adult are you not responsible for your own actions? If not a capable adult, then should not your financial affairs be in the hands of others?

There will undoubtedly be some boundary cases which test or even strain these strictures; but in most cases?

[Lootman]

"The Bank faced a compensation claim from a music teacher Fiona Philipp who, along with her husband, Robin, was tricked in an Authorised Push Payment or “APP” scam into sending their life savings – £700,000 held in a Barclays account – to a fraudster’s bank in the United Arab Emirates."

How the heck can anyone be convinced to send that large an amount to a stranger overseas?

[Spet0789]

https://www.telegraph.co.uk/money/consumer-affairs/blow-for-bank-fraud-victims-supreme-court-ruling/

"Banks cannot be held responsible for fraudulent payments that are authorised by customers themselves, the Supreme Court has ruled".

"Barclays has won a landmark legal ruling that banks are not liable for fraudulent transactions that have been requested by account holders, in a case that threatened to spark a flurry of claims from fraud victims had the bank lost."

"The Bank faced a compensation claim from a music teacher Fiona Philipp who, along with her husband, Robin, was tricked in an Authorised Push Payment or “APP” scam into sending their life savings – £700,000 held in a Barclays account – to a fraudster’s bank in the United Arab Emirates."

"The case, which was first brought against Barclays in 2020, was thrown out at the commercial court in Bristol in 2021. But that decision was overturned by the Court of Appeal last year, before lawyers for Barclays lodged an appeal with the Supreme Court.The bank’s appeal was unanimously upheld by the Supreme Court on Wednesday."

If folk don't check where they are sending (large sums of) money to, why should a third party (the bank) by held responsible ?

Very sensible.

A fool and their money are soon parted.

[murraypaul]

How the heck can anyone be convinced to send that large an amount to a stranger overseas?

10. The present case is a particularly egregious example of this type of scam. Dr
Philipp was contacted in February 2018 by an individual (the fraudster) who claimed to
be working for the Financial Conduct Authority in conjunction with the National Crime
Agency and to be investigating a fraud within HSBC and an investment firm, Tilney,
where Dr Philipp held substantial savings. In a series of telephone calls Dr and Mrs
Philipp were led to believe that their money needed to be moved to “safe accounts”.

11. It is unnecessary to relate the full history of events, as the main question raised
on this appeal is one of law and (save in one limited respect) the factual details are not
material. They can be found in the judgment of Judge Russen QC at paras 27-71. A
striking feature of the facts is that Dr and Mrs Philipp were even persuaded by the
fraudster not to cooperate with the police when they received a visit from a police
officer, DC Claridge, warning them that she believed that a fraud was being
perpetrated on them. The sophistication of the means employed is shown by the fact
that telephone calls were made to Dr Philipp which appeared, from the number
displayed on his mobile phone, to be coming on one occasion from the telephone
number of the National Crime Agency and on another occasion from the mobile
number of DC Claridge.

[XFool]

How the heck can anyone be convinced to send that large an amount to a stranger overseas?

10. The present case is a particularly egregious example of this type of scam. Dr
Philipp was contacted in February 2018 by an individual (the fraudster) who claimed to
be working for the Financial Conduct Authority in conjunction with the National Crime
Agency and to be investigating a fraud within HSBC and an investment firm, Tilney,
where Dr Philipp held substantial savings. In a series of telephone calls Dr and Mrs
Philipp were led to believe that their money needed to be moved to “safe accounts”.

OK. This is the mechanism of the fraud. However, what strikes me immediately, is that this is a pretty well known standard fraud mechanism!

I don't know who Dr Philipp is but why did this not occur to him? (Was this all from several years ago now?)

11. It is unnecessary to relate the full history of events, as the main question raised
on this appeal is one of law and (save in one limited respect) the factual details are not
material. They can be found in the judgment of Judge Russen QC at paras 27-71. A
striking feature of the facts is that Dr and Mrs Philipp were even persuaded by the
fraudster not to cooperate with the police when they received a visit from a police
officer, DC Claridge, warning them that she believed that a fraud was being
perpetrated on them.

Gosh!

The sophistication of the means employed is shown by the fact
that telephone calls were made to Dr Philipp which appeared, from the number
displayed on his mobile phone, to be coming on one occasion from the telephone
number of the National Crime Agency and on another occasion from the mobile
number of DC Claridge.

Again, all standard, well known, fraud techniques... (How did they get DC Claridge's mobile number?)

[XFool]

OK. This is the mechanism of the fraud. However, what strikes me immediately, is that this is a pretty well known standard fraud mechanism!

I don't know who Dr Philipp is but why did this not occur to him? (Was this all from several years ago now?)

I will agree this is ultimately a matter of "What did he know and when did he know it?" (Outwith any political context!)

I was always pretty confident (I believe with justification) for some years that I would never fall for the various Internet, email, phone scams. (I never have to date). My confidence was shaken some years ago when I first heard of these more sophisticated scams - starting with the phone 'Call back scam'. Where I thought: "Gosh! I can even imagine myself falling for something like that."

Interestingly, a few years previously, I remember reporting a "fault" on my landline to my then provider, TalkTalk. I reported a "reverse clear fault", they had no idea what I was talking about. I then sort information and advice on TMF. Although I had worked in telecoms and was familiar with the idea of forward/reverse cleardown, I had never worked on the landline subscriber side and just assumed the same applied to subscriber phone lines.

I was surprised to learn from TMF posters that there was no "reverse clear" on landline phones, just a local exchange time out. So I was chasing a 'fault' that did not exist. A few years later I was reading of the landline 'Call back scam'.

There are some clever but devious people in the world. In these matters there is no substitute for knowing. Forewarned is forearmed.

[Lootman]

How the heck can anyone be convinced to send that large an amount to a stranger overseas?

10. The present case is a particularly egregious example of this type of scam. Dr
Philipp was contacted in February 2018 by an individual (the fraudster) who claimed to
be working for the Financial Conduct Authority in conjunction with the National Crime
Agency and to be investigating a fraud within HSBC and an investment firm, Tilney,
where Dr Philipp held substantial savings. In a series of telephone calls Dr and Mrs
Philipp were led to believe that their money needed to be moved to “safe accounts”.

If a financial institution believes that there have been attempts at fraudulent access to or activity in your account then that institution can freeze your account, or can even set up a new account for you. I know this because it happened to me with a share-dealing account, where I was given a completely new account number and password without me doing anything.

A bank already has the access and power to move your money from one place to another, for security reasons. It doesn't need you to "send" your money anywhere. So any request to "send" is immediately suspect.

[BobGe]

An issue here might be that the very thought of someone interfering with the large sum involved here lead to a significant degree of panic on the part of the plaintiffs such that they fell for the fraud acting irrationally because they actually believed they were protecting themselves from potential loss by doing so.

[DrFfybes]

An issue here might be that the very thought of someone interfering with the large sum involved here lead to a significant degree of panic on the part of the plaintiffs such that they fell for the fraud acting irrationally because they actually believed they were protecting themselves from potential loss by doing so.

There are 2 things here that really make the victim culpable.

Firstly was not seeking another home for their assets themselves. Secondly was apparently moving their money to somewhere suggested by someone else that they had not set up. It is this last step that really should have not happened, I reckon to move that much must have been done either in steps or by CHAPS, and in either case there would have been several "have you checked who you are sneding it to, has this person requested you make the transfer, etc" questions and the victim will effectively have lied in their response to the answers.

MrsF got a whatsapp the other day, "Hi mum, can you do me a favour". This obviously came as a surprise, as she had no recollection of giving birth.

[murraypaul]

If a financial institution believes that there have been attempts at fraudulent access to or activity in your account then that institution can freeze your account, or can even set up a new account for you. I know this because it happened to me with a share-dealing account, where I was given a completely new account number and password without me doing anything.

A bank already has the access and power to move your money from one place to another, for security reasons. It doesn't need you to "send" your money anywhere. So any request to "send" is immediately suspect.

HSBC were their bank.

They were convinced by the fraudsters that they needed to move their money out of HSBC, because of fraud within HSBC.