If you have recently fallen for a scam that resulted in financial loss, you may now be desperately trying to find a way of getting your money back.
Unfortunately, there is the possibility that you won’t get your money back at all as it depends on the type of transaction and the actions you took. But there are various protection schemes in place that will hopefully be able to help you.
The information below outlines your rights by method of payment.
If you have accidentally paid a scammer using your credit card, it is likely that you will be covered under Section 75 of the Consumer Credit Act 1974, which covers consumers for transactions between £100 and £30,000.
Under Section 75, the credit card company is equally accountable for any breach or misrepresentation by a retailer or trader. This means you will be able to make a claim to your credit card company to recover your losses, which is particularly useful if the trader/retailer isn’t answering your letters, messages or phone calls (and, as this is a scammer we are talking about, this is the most likely scenario).
The act also applies to foreign transactions, as well as transactions carried out online, by telephone or mail order for delivery to the UK from overseas.
Unfortunately, Section 75 only applies to credit card transactions, not debit cards, so you are less protected if you used your debit card to pay a scammer.
It is possible to get some of your money back under the chargeback scheme which participating banks voluntarily subscribe to.
The downside is that this scheme only covers up to £100 of losses, but does apply to all kinds of good and services.
It is not guaranteed that you will have your money recovered as you will have to provide suitable evidence that there has been a breach and you are justified in your reasons for wanting to take the money back.
You usually have 120 days from the transaction being made to put in your chargeback claim, so it is important to put in your claim as soon as you are aware of being scammed.
Paying a scammer via bank transfer can cause some complications when it comes to having your money recovered as it depends on whether the transaction was authorised or unauthorised.
Unfortunately, if you have fallen for a scam which has resulted in you authorising a bank transfer to a criminal’s account, you currently have no legal rights to claim your money back. This is because banks see this as being your fault for authorising the transaction and not taking the necessary precautions.
However, a new system has been put forward by The Payment Systems Regulator (PSR) which will aim to make it harder for fraudsters to commit these crimes and will ensure that banks are following the correct protocols in order to help you recover your money. There is also the proposal for a new reimbursement scheme which should help some people get their money back under certain circumstances.
If you have accidentally handed you bank details over to a scammer and they then take money from your account which you did not authorise, you have a good chance of having your money recovered.
In most cases, if you can prove that you did not authorise the transaction, the bank must refund the payment by the end of the following business day from when they became aware of the problem. It is likely that they will ask you to fill out a form to confirm what has happened.
You must inform the bank of an unauthorised transaction within 13 months of the money leaving your account. But, it is better to do this as soon as you are aware of the transaction.
If you paid a scammer using PayPal, you may be protected under PayPal’s Buyer Protection scheme. Under this scheme you can be reimbursed in certain situations, including; paying for an item that was never delivered, the item was different than advertised, or the item arrives damaged. Advertising items that don’t exist is a very common scam that has caught out a lot of people.
This scheme will also protect you in the event that your PayPal account is hacked into and transactions are made without your authorisation.
If your bank or credit card company have refused your claim under Section 75 of the Consumer Credit Act or the Chargeback Scheme, or you are unhappy with the outcome or the length of time it is taking to resolve, you can make a formal complaint with the company or bank.
If they still dispute that you are a victim of fraud, you can ask them to provide you with a final ‘letter of deadlock’ which you can then use to take the case to the Financial Ombudsman Service. The FOS is there to resolves issues between financial firms and consumers.
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Last updated: 23 January 2020 | © KIS Bridging Loans 2020 |