Consumer finance campaigner Mark Taber described the treatment of the victims by their banks as “inhumane”.
He said: “As these cases demonstrate, scammers target vulnerable people with savings and they keep going until they have everything. Banks have a duty to stop this happening, but they are failing to do it.
“Leaving people struggling in severe cases like this is worse than cruel, it is inhumane. This is just the tip of the iceberg. The FCA needs to get really tough and should impose serious fines on banks that fail vulnerable fraud victims. This money should go into a pot to help affected customers.”
Adults with vulnerable characteristics, of whom there are almost 28 million in Britain, including those experiencing poor health, challenging life events or low financial resilience, are more susceptible to scammers.
Banks and building societies have a regulatory obligation to safeguard these customers. Three in five people who fall victim to a scam suffer from a mental health problem, according to the Money & Mental Health Policy Institute.
Impaired decision making, low motivation and increased impulsivity mean vulnerable adults are three times more likely to fall victim to an online scam than the rest of the population.
Mel Stride, chairman of the Commons Treasury Committee, said it was the banks’ responsibility to “protect their customers’ savings”.
He said: “The Government and the banking sector must be on the front foot in protecting people from financial loss through scams, particularly at a time of such economic uncertainty.”
Most scam victims will never see their money again, even though many of the big lenders have signed a voluntary code intended to improve reimbursement rates for customers who lose money to “no blame” “authorised push payment” scams.
Conor D’Arcy, of the Money & Mental Health Policy Institute, said: “Banks could definitely be doing more to protect vulnerable people from scammers. We’d like to see banks involving more people suffering from mental health problems in their design and testing of scam prevention and reimbursement policies.”