Falling victim to a scam can be a deeply unsettling experience, leaving individuals not only out of pocket but also grappling with questions about whether their money can be recovered.
In England and Wales, the legal framework surrounding scam refunds has undergone significant changes, offering hope to victims while also introducing new responsibilities for banks.
This guide provides an in-depth look at how the refund process works, the legal protections available, and what you can do if you encounter delays or disputes. Whether you’ve been scammed yourself or want to be prepared for the worst, this article will explain how long banks have to refund scammed money.
How Long Do Banks Have To Refund Scammed Money?
If you’ve been scammed, getting your money back can feel like a race against time. In England and Wales, banks are under legal and regulatory obligations to handle fraud claims promptly.
However, the exact length of time they have to issue refunds varies depending on the circumstances of the fraud and the protections in place.
While many people expect an immediate resolution, the process can take longer than anticipated.
What Does The Law Say?
The foundation of consumer protection in fraud cases lies in the Payment Services Regulations 2017 and the Financial Conduct Authority’s (FCA) guidelines. These regulations require banks to refund unauthorised transactions promptly unless the bank can prove negligence or fraud on the part of the customer.
In practice, “promptly” generally means as soon as possible and no later than the end of the next business day. This applies to unauthorised transactions where the customer did not authorise the payment. For scams involving authorised payments, such as authorised push payment (APP) fraud, the rules have been less clear historically, leading to inconsistent practices across banks
A 2024 Update To The Refunding Rules
October 2024 marked a significant shift in the rules surrounding APP fraud. Under new regulations, banks are now required to reimburse victims of APP fraud within five business days unless there is evidence that the customer was grossly negligent or complicit in the scam.
However, the five-day deadline only applies once the bank has all the necessary information to assess the claim. If the bank needs additional time to investigate—for example, to review evidence from the scammer’s side or to liaise with law enforcement—this could delay the process. Even so, the expectation is that banks communicate clearly with victims about the timeline.
This change aims to create greater consistency and fairness in how scams are handled.
The revised rules are part of an initiative spearheaded by the Payment Systems Regulator (PSR), ensuring that the financial burden of scams is not unfairly placed on consumers. Banks and payment providers must also implement systems to prevent fraud and detect suspicious transactions more effectively.
To learn more about whether or not banks refund scammed money, head here to read our dedicated guide.
What To Do If Your Refund Is Delayed By The Bank?
If your bank has not refunded you within the expected timeframe, you should first contact them directly. Ask for a detailed explanation of the delay and ensure you have provided all the information they require to process your claim.
If you’re dissatisfied with the response, you can escalate the matter to the Financial Ombudsman Service (FOS). The FOS can review your case independently and order the bank to compensate you if they find the delay unreasonable. Additionally, you may be entitled to interest on the delayed payment.
Keeping detailed records of your communication with the bank is essential. Include dates, names of representatives you spoke with, and any promises made about timelines. This evidence can support your case if you need to escalate the issue.
Do Banks Always Refund Scammed Money?
While the updated rules aim to ensure most victims are reimbursed, refunds are not guaranteed in every case. Banks can refuse to refund money if they can demonstrate that the customer acted with gross negligence. Examples might include sharing your banking passwords or ignoring clear warnings from the bank about potential scams.
In some cases, banks may argue that the customer failed to take reasonable precautions. However, such decisions are not always final. If you believe the bank’s refusal is unfair, you can challenge it through the FOS or legal action.
For more advice, head here to read our guide on how to get your money back from a scammer.
What If I Was Partially Responsible For The Scam?
The new rules take a more balanced approach to shared responsibility. If you were partially responsible for the scam—for instance, if you ignored fraud warnings but were not grossly negligent—you may still be entitled to a partial refund. In such cases, banks will often weigh the circumstances before deciding on the refund amount.
It’s important to provide as much information as possible to the bank during the claims process. Honesty and transparency about your actions can help your case, especially if you can show you were misled or under duress at the time of the scam.
What If It Was An International Scam?
International scams can complicate the refund process, as the scammer’s bank may operate outside UK regulations. While UK banks are still obligated to investigate and attempt to recover funds, the likelihood of success diminishes with international transfers. Time is also critical in these cases; the sooner the fraud is reported, the better the chances of recovery.
Some banks have agreements with international payment networks to facilitate the return of stolen funds, but these processes can be slow and are not always successful. Victims of international scams should report the incident to Action Fraud, the UK’s national reporting centre for fraud, which can coordinate with overseas authorities (and not to be confused with us!)
Get Help Recovering Money After A Scam
If you’re looking for help getting your money back after a scam, then we can help you here at Capital Refund House.
We operate a free, 24-hour helpline and all of the advice we provide comes free of charge without any obligation to proceed with your case. To speak with us today, click here.
