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FSA to monitor refunds from banks

January 30, 2010 by admin  
Filed under News, News-Banking

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It has been reported that the UK’s financial regulator, the , is to closely monitor refunds that are made by banks in instances where the consumer states that he or she has not authorised a transaction. Regulations that were brought in last November required banks to make immediate refunds to consumers for transactions that they claim that they had not made unless there was clear evidence that the consumer was involved in fraud or had been reckless.

The FSA has now stated that it will be monitoring whether banks are doing this more closely, to ensure that regulations are being adhere to by the banking industry. One customer said that he was mugged at an ATM but his claim for £1000 was turned down by the bank, showing that not all banks seem to be adhering to the regulations. This particular customer was with HSBC, and since the incident the bank has apologised and provided a refund.

The FSA has only been regulating current accounts since November of last year, and quickly brought in the regulations with regards to refunds for customers. The regulations state that the bank must make an immediate refund to the customer if the customer has not made the transaction, and if at a later date it is revealed that the customer has acted fraudulently or was reckless with their account details the banks can then take the money back.

The FSA has now asked banks for details with regards to the number of refunds they have issued, and the authority has also said that the terms and conditions of banks must also incorporate the new FSA regulations. The FSA stated: “We’ve said they have to change, that has been agreed. We’re now in the process of getting the lawyers to agree the exact wording.”

Tags: bank, ATM, Financial Services Authority, HSBC Holdings PLC, business

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