Scam Complaint Numbers Spike, Reports Ombudsman

Scammers have been busier than ever in their efforts to fleece bank customers, according to the Banking Ombudsman Scheme’s latest annual report.

Banking Ombudsman Nicola Sladden said the scheme received 535 scam complaints out of a total of 4,732 in 2021-22 - an increase of 63 percent on the previous year.

"Scammers are becoming increasingly devious in their efforts to steal customers’ money, but customers can foil the overwhelming majority of these attempts by following some basic precautions."

She said these precautions included:

- password-protecting your devices and using strong passwords or biometric log-ins

- never logging in to internet banking when someone has remote access to your device

- looking up reviews of investment companies before investing.

The scheme has produced a tip sheet to help people steer clear of the most common types of scam complaints it receives.

Ms Sladden said the scheme’s total caseload was down 1.7 per cent on the previous financial year, and the number of cases formally investigated was down even more - 15.7 per cent. She attributed this to the scheme’s early resolution service, which aimed to sort out enquiries and complaints as quickly as possible before they escalated into formal disputes.

The annual report showed the biggest source of complaints continued to be lending, half of which involved home loans. Complaints of this type rose markedly in November 2021, largely because of amendments to the Credit Contracts and Consumer Finance Act 2003.

"These legislative changes caused unexpected delays to borrowers, although we foresaw that greater scrutiny of loan applications would probably have this effect and prepared guidance for borrowers. Nonetheless, complaints rose - both to banks and to us."

Ms Sladden said the scheme had expanded its complaints dashboard, which contains data on complaints about banks, to include information on banks’ complaint-handling practices. The dashboard details how each bank resolved complaints, how long it took and what outcome it reached with the customer.

She said the dashboard was proving a valuable source of information about the nature and extent of problems in the sector, and the scheme was analysing the data to provide insights to banks, regulatory bodies and government agencies.

Another feature of the year was the scheme’s preparations to deal with complaints stemming from the impact of COVID-19, particularly from customers experiencing financial difficulty, but to date the number of such complaints had been small. However, Ms Sladden said the deteriorating economy, higher interest rates and strong inflation could change that in the coming year.

The summary annual report is available here.

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