The PSR has published draft Terms of Reference for a project looking at the potential for payment system operators (PSOs) to play a role in minimising consumer harm caused by authorised push payment (APP) scams in the UK. This follows the super-complaint submitted by Which? that made it clear the CHAPS and FPS operators do not provide protection for people who are tricked into authorising push payments.
The PSR has two key objectives :
- to consider whether it would be effective and proportionate for PSOs to play a greater role in preventing and responding to APP scams (and possibly wider fraud); and
- if it is appropriate to introduce new measures, whether it would be best to introduce them through regulatory action or through other approaches (for example, industry led).
The project will consider only APP scams that target consumers, so will focus only on CHAPS and FPS and will not include Bacs (although the conclusions may lead to further work on scams involving businesses). “On-us” payments processed internally by banks are also out of scope. The key questions PSR proposes to focus on are:
- How do UK practices towards APP scams compare with those in other countries?
- How do practices towards APP scams compare with practices for other UK disputed payments?
- What can be learned from non-payment networks?
- What are the economic incentives for preventing and responding to APP scams?
- What actions can PSR take to expand the role of PSOs in APP scams?
The deadline for views on the draft terms of reference is 21 March 2017 and PSR plans to publish the findings of its work in the second half of 2017.