Complete Guide to Bank Disputes, APP Fraud & FOS Complaints
If you have been defrauded, sent money to a scam, or your bank refused to help, you have legal rights. This guide explains APP fraud claims, chargebacks, and how to escalate to the Financial Ombudsman.
Key fact: Banks are now required to refund APP fraud victims (Authorised Push Payment scams) unless you were negligent. You can escalate to the FOS if your bank refuses.
What is APP fraud and bank fraud?
APP fraud occurs when criminals trick you into authorising a transfer to their account by impersonating a trusted person or organisation. Unlike card fraud, the money leaves your account with your consent - but obtained by deception. Banks historically refused refunds, but new rules require them to compensate victims.
Your rights under UK law
- Payment Services Regulations 2017: Banks must refund APP fraud unless you were negligent.
- FCA Handbook CONC 5: Rules governing bank liability for APP fraud.
- Philipp v Barclays Bank [2023] UKSC 25: Supreme Court ruling that banks owe a duty of care to prevent APP fraud.
- Financial Ombudsman Service: Can order banks to refund APP fraud even if they initially refuse.
- Chargeback rights: For card payments, you have up to 540 days (though earlier is better) to claim via your card provider.
Step-by-step how to claim
- Report to your bank immediately. Call and provide all details of the fraudulent transaction.
- File a police report. Get the reference number - banks require this.
- Request a refund formally. Write to your bank citing the Payment Services Regulations 2017.
- If the bank refuses, escalate to FOS. The Financial Ombudsman can order them to refund you.
- If the FOS rejects your claim, consider legal action. In some cases, banks have been forced to pay by courts.
Common scenarios
Scenario 1: You received a call from "your bank" asking you to transfer money
This is a common scam. Banks never ask you to authorise transfers in this way. Report immediately to your bank and police. Under the new rules, the bank may refund you unless you ignored obvious warnings.
Scenario 2: You sent money to what you thought was a trusted business
If you can prove you were deceived (fake email domain, forged invoice, impersonation), the bank should refund under APP fraud rules.
Scenario 3: Bank delayed processing - money went to scammer instead
If your bank delayed a transaction and you lose money as a result, they may be liable for negligence.
Key deadlines
- Report fraud: Within 48 hours of discovering it (for best chance of bank tracing money).
- Bank response to formal claim: 8 weeks under FOS complaints procedure.
- FOS escalation: Must escalate within 6 months of bank's final decision.
- Chargeback claim: Up to 540 days from transaction (varies by card issuer).
Escalation options
Financial Ombudsman Service: Can review bank decisions and order refunds for APP fraud, misconduct, or negligence.
Court claim: For significant amounts, you can sue your bank for negligence or breach of the Payment Services Regulations.
Common mistakes to avoid
- Delaying reporting - banks use this as an excuse to refuse refunds ("you should have noticed").
- Not providing evidence of the deception.
- Ignoring bank requests for information - provide everything requested promptly.
- Assuming you will not get the money back - many FOS cases succeed.