Identity theft and scams: how to get your money back

Losing your card, finding that someone has accessed your bank account or losing money through a scam can be distressing. But if you are a victim of identity theft or a scam there are some safeguards to help you get back the money you have lost. Find out what you may be liable for and how to get money refunded.

Identity theft – What are you liable for?

Identity theft is when your personal details are stolen and identity fraud is when those details are used to commit fraud.

If money has been stolen from your bank account, or your debit or credit card has been used fraudulently, in most cases, you should be able to get that money back.

How quickly your bank has to refund the money may depend on whether:

  • The money stolen was your own money (so from your own bank account, for example)
  • Someone has fraudulently used a credit facility in your name (for example a credit card)

What happens if money was stolen from your debit card?

Tell your bank or building society as soon as you think your bank card might have been stolen, or that someone got hold of your account’s security details.

If money is stolen from your debit card, then the relevant piece of legislation is the Payment Services Regulations. It says you must be refunded immediately if you have had money taken from your account without your permission.

Remember that:

  • You will be liable for any unauthorised withdrawals made before you tell your bank or building society, up to a maximum of £50,.
  • If the bank has reasonable grounds to think you have been grossly negligent with the security of your account or tried to commit fraud , it can delay refunding while it investigates.
  • You can be liable for all the losses, but realistically this will only apply if the bank or building society can prove you were grossly negligent. This means more than ordinary carelessness, for example telling someone else the PIN for your bank card, or leaving it written where anyone can see it in your office or workplace.
  • Unless the bank can prove you are liable it must refund the money and put your account back in the state it would have been if the money had not been taken. This means that any interest or charges you have paid because of the fraud must also be refunded.

You won’t be liable for any losses once you have reported that your card has been stolen, or if you report that someone else may have got hold of the security details of your account.

What happens if the money was stolen from your credit card?

If the money stolen is on credit, the Consumer Credit Act applies. This legislation states that forany unauthorised transactions the cardholder may be held liable for the first £50 spent if a card is lost or stolen. Again many banks and building societies will waive this.

  • Once the theft has been reported to the card provider, the cardholder is not liable for any further money spent.
  • In reality your bank or credit card provider may not charge you for any money spent by fraudsters, unless it can prove you have been negligent.
  • Report any lost or stolen cards or unauthorised transactions to your card provider as soon as you spot them.

If your bank rejects your claim of identity theft

Your bank may reject your claim for a refund if it believes it can prove that you have been grossly negligent or acted fraudulently.

This does not have to be the end of the matter though – you can complain to the bank, and then if you’re not happy with the way your complaint has been dealt with, you can then take your complaint to the Financial Ombudsman Service.

Identity scams – What are you liable for?

Unfortunately, if you’re a victim of a scam you may not get your money back.

However, depending on how soon you realised you may have been the victim of a scam and the payment method used, it may be possible for your payment service provider to cancel or reverse the transaction.

The card examples relate to where you authorised a transaction. If you didn’t authorise the transaction then your rights are the same as described earlier in this guide.

If you paid by credit card and became a victim of identity fraud

If you’ve spent over £100 and up to £30,000 on a credit card, the Consumer Credit Act means you should be able to claim that money back as your credit card issuer is jointly liable with whoever you’re paying if something goes wrong.

Contact your credit card provider as soon as you realise you’ve been scammed.

Some scammers are now taking advantage of this protection by setting up fake websites selling tickets to major sporting events or concerts. Once they have your money, they will say there has been “a problem with a supplier” or similar and tell you to claim the money back from your credit card provider.

If you paid by debit card and became a victim of identity fraud

Some debit card providers offer a Chargeback scheme where they may be able to recover some or all of your money for you after looking into it.

Contact your card provider as soon as you realise you’ve been scammed.

If you are spending over £100 and you are not 100% sure about the purchase, use a credit card to ensure you are protected.

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