Cruel ‘scam of mum and dad’ sparks a regulatory crackdown
T he text message began: “Hi Dad!”. The sender informed pensioner Graham Price* that their phone had fallen down the toilet, so they were using a temporary number while it was repaired. Chattily, they mentioned the number change had locked them out of online banking when they had an urgent bill to settle.
Convinced that he was messaging his son, Price offered to lend the money and was given the details of the creditor. He transferred £1,850.40.
The following day he discovered the texts had been from a scammer, and his money had vanished.
“He, or she, was so convincing I genuinely thought it was my son who needed help,” says Price. “I am 71, and the money I paid out in good faith was savings for winter fuel bills.”
He was taken in by an invidious scam which tricks parents into believing their offspring need help. Last year, £1.5m was lost to this racket between February and June, according to Action Fraud, the UK’s reporting centre for fraud and cybercrime.
It originally did the rounds on WhatsApp, but has increasingly spread to text messages, with victims like Price finding they are unable to reclaim their lost money.
This is set to change. The financial services and markets bill, currently being scrutinised by the House of Lords, will force sending and receiving banks to step up customer protections and refund victims when they inadvertently transfer more than £100 to imposters.
Under the plans, the banks must refund the entire amount, minus a £35 excess, within 48 hours. The Payment Systems Regulator is consulting on the scheme, due to be launched by the end of the year.
Meanwhile, the Lending Standards Board – a self-regulatory body for the banking industry – this month announced plans to force banks to develop more
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