The role of receiving banks has long been scrutinised when it comes to the prevention of APP scams, in which victims are tricked into sending money to accounts held by fraudsters. APP fraud has already overtaken card crime in the UK and been decried as an "epidemic" by politicians and consumers, who have been pushing banks to up their game in preventing such crime.

The LSB’s update to Contingent Reimbursement Model Code (CRM Code) will require firms to go further in identifying new and existing accounts at higher risk of being used by criminals.

By no later than December 2023, firms must be monitoring the payments that they are receiving to help them identify suspicious inbound payments and accounts that might be being used by scammers.

Emma Lovell, chief executive of the LSB, says: "Strengthening the Code’s provisions means putting in place another tripwire for fraudsters looking to steal people’s savings - not to mention the money needed for essential living costs.”

The CRM Code, launched in 2019, requires banks to reimburse customers who lose money through no fault of their own. The Payments Systems Regulator (PSR) is currently consulting on a proposal for mandatory reimbursement for victims of scams where more than £100 is stolen.

Says Lovell: “Reimbursement can repair the financial impact on the victim, but it is still very much a lose, lose outcome. Victims lose because they will feel the after-effects and trauma of being scammed even after reimbursement and society loses as organised criminals reap the rewards of theft.

“Scammers aren’t slowing down, and so we cannot take our eye off the ball. Only by stopping scams can customers truly be protected. Maintaining an industry code focused on preventing and detecting scams ensures firms have the tools to stop more scams and demonstrates their commitment to good customer outcomes and protections.”