The Financial Conduct Authority (FCA) has urged banks and payment firms to strengthen their response to romance fraud, warning that more needs to be done to protect customers “under the spell” of scammers. After reviewing how six major banks and payment providers handle these cases, the regulator found missed opportunities that left victims exposed to huge losses.
One victim lost £428,000. Another made 403 payments totalling £72,000 to someone they thought they loved. In another case, a customer sent cryptocurrency to Iraq at the request of a supposed “partner” serving in the military.
Romance fraud cases rose by 9% last year, costing victims an estimated £106 million, though the FCA believes the true figure is far higher.
“Romance fraud is a vicious crime. All too often it is the vulnerable that fall victim. The impact – financially and personally – can be devastating. We recognise the challenge banks and payment firms have in combating this complex crime and this review aims to help them stay one step ahead of the criminals. 'We also all need to be on guard so we can protect ourselves and loved ones by recognising the romance fraud red flags.”
What is romance fraud?
Romance scams aren’t just heartbreak stories. They’re part of the bigger APP fraud epidemic that is costing UK consumers hundreds of millions a year.
In romance scams, criminals build fake relationships online — often through dating apps or social media — gaining trust before asking for money to cover emergencies, travel or family crises. The money goes straight into the fraudster’s account and is quickly moved between banks, often overseas, making recovery almost impossible.
For many victims, the hardest part isn’t the financial loss, it’s the emotional fallout. Criminals don’t hack your account. They hack your trust.
The reimbursement rules
For years, victims of APP fraud struggled to get their money back. Banks often refused reimbursement, arguing that because the payment was authorised, they weren’t responsible. That changed in October 2024, when the Payment Systems Regulator (PSR) introduced mandatory reimbursement rules — a long-overdue shift towards real consumer protection.
The new rules mean:
- Most banks and payment providers must reimburse victims who meet the eligibility criteria
- Claims must be made within 13 months of the last fraudulent payment
- Reimbursement is capped at £85,000 per scam, covering the majority of cases
- Vulnerable customers have extra protection — they can’t be denied reimbursement for being “grossly negligent”
- Banks must reimburse quickly — within five business days, or up to 35 if more investigation is needed
It’s progress, but it’s not perfect. The rules only apply to payments made via Faster Payments or CHAPS, not to crypto or international transfers, where many scams still thrive.
What the FCA wants banks to do
The FCA said that while many banks and payment firms are already going to “significant lengths” to protect customers, there’s still room for improvement. The regulator has set out several steps to help firms “break the spell” of romance fraud and prevent more victims falling through the cracks:
- Spot the patterns. Repeated transfers, unusual amounts, money moving overseas — these aren’t routine transactions, they’re warning signs.
- Ask the right questions. Frontline staff need the training and confidence to pause a payment and probe when something doesn’t add up.
- Support the victims. When fraud happens, aftercare should be human and compassionate — not a wall of process and paperwork.
The FCA report also noted that some firms provided an exceptionally high level of support, in one case, making 11 separate calls over six weeks to help a victim break free from a fraudster’s control. But it warned that this level of care isn’t yet consistent across the sector.
The human side of fraud
What makes these cases even harder is the shame that so often surrounds them. Many victims feel embarrassed or fear being judged, so they don’t come forward, meaning the true scale of romance fraud is far higher than official figures suggest.
The FCA found that 42% of victims didn’t tell their bank the real reason for their payments. Some said they were investing overseas or buying property when, in reality, they were sending money to a scammer.
It’s a painful mix of trust, silence and missed opportunity. People are too ashamed to speak up, and banks are often too cautious to challenge. That’s exactly where fraud thrives.
Preventing romance scams isn’t just about better algorithms, it’s about understanding human behaviour, vulnerability and emotional manipulation, and giving staff the tools to intervene before it’s too late.
Why this hits home for us
At Join the Claim, we’ve been raising awareness of all types of APP fraud — including romance scams — and we support the FCA’s call for stronger, more consistent protection. The review shows that some banks are getting it right. But the system still needs clearer standards and faster action when things go wrong.
We’re calling for three things:
- Real prevention. Banks need smarter checks that actually stop suspicious transfers before they happen.
- Fair reimbursement. Victims shouldn’t have to fight for what they’re owed. Despite the reimbursement rules, some claims are still being rejected.
- Shared accountability. Social platforms are where 85% of these scams start. They should be part of the fix, not the problem.
If you’ve been targeted by a romance scam, you’re not alone, and you might be able to claim your money back. Read our guide on how to get your money back after APP fraud — a plain-English walkthrough of the rules and your rights.
