HSBC scare tactics?

Hi, I’m Eric and I am new to Monzo. Something a bit disturbing happened to me and I wanted to share. I made a “higher than usual” transfer to my Monzo today and it did not go through immediately compared to the previous ones.
Then I received a call from the security & fraud department of my other bank (HSBC) , which asked an unusual amount of security questions - felt like I was talking to a police officer - before they started to explain that there was lots of frauds, security issues and criminal activities going on with Monzo. All this to finally ask me if I wanted to proceed with the transfer. When I said yes, they said HSBC declined all responsibility from that point on.
Obviously, I am not an idiot and I realized these were scare tactics to dissuade me to use Monzo. Are traditional banks freaking out to the point they need to use low blow strategies to counter attack? Can’t they realize this is actually counter productive and will play against them in the end?
For as much as I appreciate that my bank looks after my finances security, I also despise this sort of disguised bullying and the sense of panic they transmit…

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Must of been quite large. I transfer from
Hsbc to monzo quite regularly.
Will wait to see if anything happens next payday.

I’m not confident you can ascribe this as being because HSBC is scared of Monzo (or other challenger banks). There is a big problem at the moment with fraud from bank account to bank account, banks are rightly quite wary about suspicious payments and err on the side of caution. Sometimes a bank will do everything they can to convince a customer that a requested payment is fraudulent and the customer still goes through with it, they have to ensure as best possible that the customer really understands what is going on to protect customers and reduce their liability.

Monzo is easy to open an account with (relative to some other banks) so it’s plausible that it would be used by fraudsters, and while of course Monzo are very much against fraud and will do everything they can to stop it, they’re a relatively new company without the same experience and controls as more established banks… on top of that, when a person working in the fraud department of HSBC sees fraud involving a Barclays account it doesn’t register because Barclays is so well established, they’ve seen it their entire career, whereas when they see Monzo they think “huh, Monzo, that’s new, seeing a lot of Monzo popping up recently…”.

Anyway I can’t speak to what is actually going on but I’m doubtful that an HSBC fraud department employee is scared of Monzo.

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I know a few people who’s first transfer to Monzo was blocked by their bank as “usual behaviour”. They had to confirm something online or call up to confirm the transaction. These transactions were only for around £100.

NB: future transactions to their Monzo account all went through fine.

I don’t think it’s fair to say that this is HSBC being scared of Monzo or any other bank. There’s a massive issue with fraud and people falling for scams so the more protection they try and take the better.

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I appreciate what you are saying (and the genuine security concern of the bank is valuable) But the amount of questions and comments regarding the risk of using Monzo are what made me tick. I have received calls from fraud department before and it was much more chilled. The guy was not scared, he was trying to scare me. And the final comment was the cherry on the cake: “From now on you are on your own”. I shared to see if this has happened with other users.

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I had that very same experience with HSBC last month despite having a track record of transfers into my Monzo account for years (if you include prepaid!).

I agree with you in principle that HSBC are going a little overboard, given the bank accounts are both in my name, but this is the type of behaviour why I’m leaving HSBC so it’s probably to be expected! Their idea of fraud prevention is just blocking as many of my transactions as possible!

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Bit rich of HSBC to accuse anyone else of being dodgy

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you should have directed them to the Netflix series Dirty Money that shows how HSBC America helped Mexican drug cartels launder $millions, or the Bloomberg article that reports how HSBC could face penalties of $1.5 billion for helping customers evade taxes.

Who are the criminals here??

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I had the same problem when I was selling a house. My solicitor’s bank (Lloyds) tried to block transfer to Monzo of my sale proceeds. This is despite my solicitor meeting me face to face and performing all necessary checks, and this company being familiar with transferring large amounts of money to/from this account for legitimate reasons. This was explicitly about Monzo. Comment such as ‘don’t you have an account with another bank’ were made to me from my solicitor direct from Lloyds, and when I said no I was again threatened with the same type of language as this HSBC call such as ‘we’ll take no responsibility for this money reaching you’. I was concerned as the amount was over £250k. However I had confidence in Monzo and insisted they continue with the transfer. The money reached my Monzo account within a few hours. I thought of contacting regulators to make a complaint but determined I couldn’t as I was not the customer of Lloyds. Clearly if the money had not arrived in Monzo despite providing accurate account details I would have taken this further, however I do see a pattern and believe this is deliberate anti-competitive practices by the major banks wrapped in some fake ‘security’ justification. I would suggest it is really easy for them to flag the Monzo sort code as suspicious, to purposefully frustrate Monzo customers, whereas they could not get away with the same behaviour for one of the larger banks. I hope Monzo themselves is taken action to report this anti-competitive behaviour.

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Had exactly the same response when I transferred all my business funds from HSBC to Monzo. A very sniffy, nose-in-the-air “we take no responsibility”.

It’s not going to be anti competitive behaviour because monzo isn’t really much of a competitor.

The fact is we don’t know the ins and outs of the security side of banking and it could very well be that there are issues with monzo that mean money may be flagged.

They said they take no responsibility for the money reaching you, if your details are correct they won’t stop the transfer, it would be monzo stopping the transfer. They’ telling you once the money has left, if monzo block the transfer it’s not on Lloyds. It’s very likely they’ve had issues before and are just giving you fair warning because of the large sum.

Hi Eden. I disagree. Whilst I agree Monzo is not much of a competitor it is still a competitor and as such making life difficult for Monzo customers is anti-competitive. Plus Monzo were not blocking anything. This was Lloyds not being prepared to send the money to this sort code. This was entirely on the Lloyds side.

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They were prepared, they sent the money, they just warned you to possible issues, likely issues they have experienced in the past. They need stopped you transferring the money.

And as much as you might want to, Monzo isn’t a competitor. They do current accounts and not much more, the other banks are in a whole other league.

I think the issue is more that Lloyd’s immediately blocked a transfer to a Monzo account.

Lloyds did exactly the same to a member of my family after she set up her Monzo account. She only tried to transfer £100.

Although for a transaction of over £250k you’d think any bank would double check.

I work in Faster Payment fraud for one of the big banks and unfortunately whilst most of the payments that go to Monzo accounts are genuine, there is a disproportionate amount of social engineering fraud going to Fintechs, in certain circumstances.

I can confidently tell you that £250k going from a solicitors account to a personal fintech account screams invoice fraud. This has nothing to do with Monzo. It has the appearance of a fraudster taking advantage of the easy, remote on boarding process that Monzo and others have.

Every other week there is an article in the Daily Mail or the Guardian with someone crying foul that they fell for a scam and the bank didn’t stop the payment.

HSBC are obligated not only to check that was the OP making the payment but now they have to be sure he is not being scammed, hence the liability notice.

With respect to the OP, HSBC will pay you £150 to switch to them. Employing a person on £25kish a year to stop you moving to Monzo is not exactly economic.

Also, it’s not anticompetitive if a payment is being refused within the T’s&C’s of your internet banking agreement. And from my understanding they have completed the payment after a security check, so there is no material advantage to HSBC or Lloyds in these cases.

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This is all related to the ‘Which’ super complaint that was made with regard to authorised payment scams. There’s a voluntary code that banks are signing up to which means they have increased liability in the event a customer is a victim of this type of scam.

In preparation for this banks are putting systems in place to ensure their customers are fully aware before they hit ‘send’. I transferred £1000 to my Monzo account the other day (in-app using a payee I set up in 2016) and Santander gave me warnings every step of the way that the payment might not be legitimate. I am happy with that; I like to think of myself as pretty intelligent but there are so many people who have been hit hard by this type of scam and lost their life savings. (For the record tested it with another payee to a legacy bank account and the same warnings came up.)

Honestly, it isn’t about Monzo, it’s about the fact that you’re making a faster payment to another bank, and HSBC wanting to ensure you aren’t subject to fraud.

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Yes, but when you’ve explained “I’m moving money from my own account (or my own business’s account) to another bank where I (or my business) own the account”, a sniffy dismissive attitude seems like sour grapes and obstructiveness at losing the business. It was only when I went I to a HSBC branch to close my business account that they took a genuine interest in my reasons for moving, and we had a sensible discussion about the pros and cons of HSBC and Monzo for business banking.

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Sorry to tell but you but you are plainly wrong. People have been able to transfer money to other banks before Monzo existed and security checks have always been in place.

What ever poor business practices HSBC have had in the past/ present, it has no relation to the expensive running of anti-fraud systems. It would be far cheaper for HSBC to offer you a loss leading bank account than employ a huge amount of staff, to ‘frustrate’ you every once in a while when transferring your money.

One MO is where a fraudster claims to be from HSBC, advises their victim that their HSBC account is under threat and to transfer all their money to a new safe account. This new safe account could be with Monzo. As name checking is not available yet HSBC would have to speak to you, to make sure you are not one of those victims. I have even seen fraud being committed between someones own genuine accounts, personal- personal and business- personal.

HSBC know it is you making the payment, especially if it is made on a trusted device or with the secure key. What they don’t know is, if you are being socially engineered.

The fraudsters coach people of all types, on how to lie to the bank when payments are being security checked. I have had solicitors, doctors, business people and persons of the cloth lie explicitly under these circumstances only to come back later when they realise they have been scammed.

Fintechs are great at disrupting some of the sloth like elements of personal banking, but equally this had made life easier for some fraudsters. For the moment, fraud to Monzo is much a thing as any other Fintech.

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I’ve worked in financial services and related areas for over 30 years. I know about authorised push payment fraud, social engineering, AML, KYC etc. I’m aware of the delays in the introduction of the Confirmation of Payee service which mean that checks like this are more manual than they might otherwise need to be (though even that isn’t a panacea). But when it’s been established that it’s a genuine transfer for a genuine customer, there’s no need for the kind of attitude which I and others have described on this forum. If you’re losing a customer, they’re even less likely to return if you take that kind of attitude.

Edit: Just under 30 years. Sometimes I have to remember I’m not as old as I think I am.

Also worth noting that there are products on the market which can help* firms avoid “invoice fraud” such as Experian Bank Wizard Absolute. The license fee is into the low 5 figures but one fraud attempt averted can save that and more. *in conjunction with a robust set of internal policies and processes.

Further edit: I don’t work for Experian, other products are available though I haven’t evaluated those in-depth.

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