What is APP fraud?
APP fraud occurs when a victim is manipulated into authorising a bank transfer to an account controlled by a fraudster. Unlike unauthorised fraud where criminals access your account without consent, you initiate the payment yourself — having been deceived.
Common types include investment scams, romance fraud, purchase scams, impersonation fraud (someone pretending to be your bank or HMRC), and invoice fraud. All of these can qualify for reimbursement under the current rules.
The PSR mandatory reimbursement rules
Since 7 October 2024, the Payment Systems Regulator (PSR) requires banks to reimburse APP fraud victims up to £85,000 within 5 business days. This applies to payments made via Faster Payments and CHAPS between UK accounts.
Banks can only refuse if they can prove you were ‘grossly negligent’ — a very high legal bar that means far more than simply being tricked. They can also apply a £100 excess (deducted from your refund), though this doesn’t apply to vulnerable consumers.
If your bank invokes ‘stop the clock’ provisions to investigate further, they have up to 35 business days to respond.
Step 1: Report to your bank
Contact your bank as soon as you realise you’ve been scammed. You have 13 months from the date of your last fraudulent payment to make a claim under the PSR rules.
Your bank must acknowledge your complaint and begin investigating. They should also attempt to recover the funds from the receiving bank.
Step 2: Bank investigates and responds
The bank must respond within 5 business days (or 35 days with stop-the-clock). They will assess whether you meet the consumer standard of caution, which requires that you reported promptly, cooperated with information requests, and consented to police reporting.
The bank can fully reimburse you, partially reimburse you, or reject your claim.
Step 3: Escalate to the Financial Ombudsman
If your bank rejects or partially upholds your claim, you can escalate to the Financial Ombudsman Service (FOS) within 6 months of the bank’s final response. The FOS is free for consumers and can award up to £430,000 — significantly more than the PSR’s £85,000 cap.
The FOS currently upholds 44-54% of APP fraud complaints. If you’ve been rejected by your bank, the odds of overturning that decision at FOS are meaningful.
When professional help makes a difference
While you can pursue a claim yourself, professional representation significantly strengthens your case — particularly at the FOS stage. A well-drafted complaint citing specific regulatory obligations is harder for banks to dismiss than a general complaint.
Professional representatives know which arguments work for specific banks and scam types, understand the regulatory framework in detail, and can prepare comprehensive evidence bundles for FOS submissions.