On 14th April 2019, TSB launched the Fraud Refund Guarantee, covering victims of fraud from losses by refunding the stolen money from their account. The scheme, which is the first of its kind in the UK, offers refunds even in situations where the fraud was enabled by the customer’s mistake in giving out their details. But what impact could this announcement have on the travel industry?
What is TSB’s criteria for claiming a refund on fraud?
Under the new Fraud Refund Guarantee terms, TSB say that they will “now cover customers who are clearly innocent victims of fraud on their TSB accounts” from 14th April 2019. Whether money was taken directly from your account without your knowledge, or you accidentally gave the fraudsters access to your account via an honest mistake, you’ll be entitled to a refund.
There are a couple of provisos, however. Of course, if you were involved in committing the fraud then you won’t be entitled to a refund, and the guarantee is limited to a maximum of £1m per claim. Claims submitted prior to 14th April 2019 are not eligible, and TSB also note that “if you got a decision from a claim that you made before 14th April 2019, this decision cannot be overturned unless there is new evidence that would have made us reach a different decision at the time”.
TSB will be offering fraud prevention workshops at sites around the country as well as giving safety advice to victims, and will not refund customers who have repeatedly been victims of fraud if they have not followed the company’s advice on protecting their account.
What does this mean for the remaining banks in the UK?
The Fraud Refund Guarantee puts pressure on other banks to adopt similar policies, although each bank will have its own approach to combating fraud. While all banks are legally obliged to refund victims of fraud in certain situations, there are many loopholes which the banks can exploit to limit payouts – TSB is the first to offer protection to customers who have unwittingly consented to a scam that leads to their account being defrauded.
It is also worth considering that the Fraud Refund Guarantee may have the unintended consequence of increasing the volume of fraud attempts. If criminals see that banks are accepting liability for any losses incurred, they may see it as an easier crime to commit, or that the customers targeted aren’t really victims because they will be reimbursed.
How will this impact the holiday and business rental industry?
It is important to remember that while the Fraud Refund Guarantee does provide a level of protection to customers from the impact of fraud, it will not prevent fraudsters from targeting innocent people. With that in mind, the travel industry must continue to look at ways in which it can combat fraudulent activity and protect its customers – particularly as the fraudsters’ methods become more advanced.
At the moment, it is not known how exactly this will impact people who have been, or are currently, the victims of property rental fraud, or how it will affect the travel industry. TSB have stated that they must be given clear evidence that fraud has taken place and have acknowledged that, in order to safeguard the scheme from abuse, there may be future adjustments to the Fraud Refund Guarantee, in line with guidance or requirements from regulators or enforcement authorities.
That’s where I-PRAC come in. Many well-known booking platforms do not require property owners or booking agencies to provide any proof of their ownership, making it easy for criminals to hide fraudulent discounted offers among the many genuine operators – whereas booking with an I-PRAC-approved property guarantees that your booking is legitimate and secure.
The importance of verification in stamping out fraud
I-PRAC’s global verification platform offers holidaymakers protection from property rental fraud by carrying out rigorous checks on companies that offer short-term holiday and business rentals in 28 countries around the world. Any property or agency registered with I-PRAC will have been approved as a legitimate operator, so you can enjoy your holiday safe in the knowledge that your payments are guaranteed against rental fraud.
I-PRAC membership gives travellers, businesses and property owners the peace of mind they need to rent with confidence. By checking for the I-PRAC logo, you’ll know that an owner’s bank details have been subject to detailed checks and verification, that the address is correct and that the building exists. Contact us today to find out how we are protecting travellers globally from the threat of rental fraud.