TSB becomes first British bank to give fraud victims compensation

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TSB has become the first bank to promise compensation to all victims of fraud – piling pressure on others to follow their example.

High street lenders have long resisted paying compensation to customers who are tricked into transferring money to criminals.

But TSB now says it will pay out to all victims hit by these scams, setting a major precedent for the banking industry. The move is a victory for the Mail, which has campaigned for fairer treatment of victims.

Other lenders such as Lloyds and Royal Bank of Scotland now face calls to follow suit. Gareth Shaw, of consumer group Which?, said: 'Finally, a bank has recognised the daily devastation caused by fraud and pledged to protect its customers from these increasingly complex scams.

'We look forward to seeing TSB's move delivering real results for customers, with the bank swiftly and fairly refunding all victims. 

Other banks should quickly make the same pledge – as their customers will rightly be questioning why their bank chooses to leave them unprotected.'

Fraudsters often win their victims' trust by pretending to be a police officer or other respectable figure, telling targets their money is in danger and must be moved to a new account to keep it safe.

A total of £354million was stolen last year through these scams, known as authorised push payment frauds. 

Until now, banks have refused to give compensation in these circumstances, claiming it is the fault of the victim.

TSB has now promised that it will refund all customers hit by scammers – making an exception only if someone repeatedly ignores safety advice and is defrauded time and time again. 

Martyn James, of complaints website Resolver, said: 'The bank will need to see you were an innocent victim of fraud – and you still have a responsibility to not hand over the keys to your account carelessly.

'But have no

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