Monday, December 23, 2024

The bank named in more fraud complaints than any major UK competitor

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Online bank Revolut has been named in more fraud complaints than any major UK banks last year, with some customers questioning how much they were protected from scammers.

The financial firm now faces questions over the effectiveness of its security controls, according to a new report.

Over the last year, the UK’s reporting centre, Action Fraud, received 9,793 reports of fraud in which Revolut was named, according to a freedom of information (FOI) request submitted by BBC Panorama.

This was about 2,000 more than Barclays and Lloyds, and double the number which named Monzo, a digital bank with about 10 million UK customers.

Revolut has more than nine million UK customers and 45 million around the world, but until recently was still classified as an electronic money institution in the UK.

Revolut said it recognises that a ‘small number’ of its customers have had negative experiences
Revolut said it recognises that a ‘small number’ of its customers have had negative experiences (PA Media)

In July, it said it had secured a banking licence in the UK after a three-year wait for approval.

It is currently in the process of building up its banking operations and will eventually be able to hold customer deposits and offer lending products like credit cards, personal loans and mortgages.

Revolut said it recognises that a “small number” of its customers have had negative experiences with the company, but it does not believe that to be the case for the “vast majority of customers who continue to enjoy Revolut’s products and services”.

“Revolut takes fraud and the industry-wide risk of customers being coerced by organised criminals incredibly seriously,” a spokesman said.

Nevertheless, one Revolut customer told the BBC he had £165,000 stolen from his business account by fraudsters, after being tricked into sharing information and authorising payments to fake accounts.

Jack, who did not wish to give his surname, said it took 23 minutes after contacting Revolut via its in-app chat function to reach the right department to freeze his account, during which time another £67,000 was taken.

He said he felt he was failed by the app’s systems, which did not automatically spot that a large number of transactions to a new payee could have been suspicious activity.

Rocio Concha, director of policy and advocacy at consumer group Which?, said the investigation suggests that “some banks and payment firms are not taking fraud seriously enough”.

She said the Government and regulators need to make sure both payment firms and online platforms put in place “meaningful measures” to protect consumers from scammers.

Revolut recently said Facebook and Instagram owner Meta was behind 62% of all scams reported to the firm over the first half of 2024, and that it is calling for the technology giant to share the reimbursement of fraud victims.

It also said it prevented more than £475 million worth of potential fraud losses to its customers globally in 2023.

“Nevertheless, there will always be more to do to tackle this multi-industry issue and we will continue to work towards reducing fraud rates further,” the spokesman said.

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