Measures including a voluntary reimbursement code have repeatedly failed to adequately protect consumers and provide reimbursement for victims, the consumer group said.
Scammers pocketed £479 million in 2020 from authorised pushed payment (APP) fraud alone, whereby victims are tricked into transferring money.
Which?, however, said reimbursement rates remain extremely low, with banks finding victims at least partly responsible for their losses in 77% of cases assessed in the first 14 months of the code.
The reimbursement code states that victims should be reimbursed unless the firm can establish the customer did not have a reasonable basis for believing the person or organisation they were sending money to was genuine.
Despite this, figures from the Financial Ombudsman Service indicate that banks are getting many decisions wrong, with 73% of complaints about APP fraud upheld in favour of consumers in 2020-21.
Jenny Ross, Which? Money editor, said: “Fraud can have a devastating impact on victims, and it is unacceptable for so many to be abandoned when they turn to their bank to try and get their money back.”
Which? highlighted one case in particular whereby a First Direct customer in his 70s was denied full reimbursement for £180,000 losses to an investment scam.
The bank responded saying it had “every sympathy” with the customer’s…