‘Don’t come crying to us’ – RBS fraud victims should not expect automatic refunds, says bank’s boss

The chief executive of 73 per cent taxpayer-owned Royal Bank of Scotland has warned that victims of bank fraud should not expect it to provide automatic refunds.

Ross McEwan insisted it was not the responsibility of banks if customers gave their account details – or money – to online scammers, as it would be too costly to cover all the losses.

Between January and September 2015 almost 5,000 RBS customers lost £25 million to fraudsters, an average of £5,000 each.

Mr McEwan said reimbursing would lead to increased fees and charges.

He said: “We are working very hard to help customers detect when there are difficulties but I think this has to be in partnership with the customer and with the bank.

“You can’t keep blaming this on an organisation where customers don’t take their own duty of care as well.”

Financial Conduct Authority rules state banks must refund victims of fraud unless they can prove negligence.

The bank has 24 million customers with around five million using one of its mobile phone apps.

However, online fraud is also increasing, with banks facing at least one cyber attack each week.

Mr McEwan added: “When people are passing their iPads or laptops over with their passwords and the likes, there’s got to be a care here, otherwise this will just become a major issue for all and the cost will pass through.”

Reacting to the banker’s comments, Labour MSP for Lothian Neil Findlay said the position taken by the bank was “out of touch” with its customers.

Mr Findlay, who has campaigned against RBS closures in West Lothian, said: “This is typical of the arrogant and dismissive way in which RBS treat loyal customers of many years’ standing.

“Firstly they closed branches then withdrew mobile banking services, forcing people to travel to branches elsewhere or to use banking apps or go online.

“Ross Mcewan and the RBS board, who work in what is effectively a nationalised industry, are out of touch with the customers they aim to serve.”

Gareth Shaw, from consumer group Which?, said the banking industry and Government need to take “firmer action” to protect consumers.

He added: “Banks are still placing too much responsibility on consumers to spot and protect themselves from sophisticated online scams.

“We’ve heard from many people who have lost life-changing amounts of money through bank transfer fraud, through no fault of their own, who are unlikely to get their money back from the banks involved and who have seen little action to help them.”

Professor Paul Freathy, of the marketing and retail department at the University of Stirling, explained that vulnerable customers were particularly at risk.

“The bank is not going to give carte-blanche for people to be reimbursed in every instance.

“But it is very wrong of them to assume consumers are careless. Many are forced to use online banking and apps when they may not be technically savvy, creating a degree of vulnerability and making them a potential target audience for scammers.”

An RBS spokesman said: “Where a customer has suffered loss we review their situation, establish the facts and make a decision on a case-by-case basis.”