The fraud traps set by your bank

For many of us – particularly the elderly – recording the information needed to conduct our financial affairs is more a necessity than a choice. At the last count, the average person had 22 accounts that needed one or more passwords, according to the Payments Council. More than one in six of us had over 40 such accounts. The research was conducted in 2012 and the figures are likely to have increased.

Banks alone ask for a different Pin on each card, various internet and telephone passwords, usernames, identity numbers, memorable names, places, dates and so on. We are expected to remember them all without aid.

Crucially, bank customers are advised by security experts to use different passwords for each account. This is to lessen the chance of a single security breach affecting the other accounts.

Prof Martin A Conway, head of psychology at City University London, has researched human memory for 32 years. He said it was only reasonable to allow customers to write down passwords, particularly as our ability to remember information declined with age.

“Nobody has a perfect memory, almost everyone has to write their various Pin and passwords down or record them somewhere,” he said.

“The ability to take information in, called encoding, and to draw information out again, retrieval, just does not work as well as we get older. We may have already encoded a lot of numbers in one form or another and memorability becomes difficult, even for someone who has set their own passwords.”

The Sunday Telegraph asked the British Bankers’ Association, the industry trade body, to justify banks’ uncompromising attitude to genuine fraud victims who write down passwords. It said customers could opt out of the latest technology if their memory wasn’t perfect. Instead, they could request a chip and signature card or use cheques.

However, banks and building societies continue to push customers towards mobile and internet banking and the latest debit and credit cards to reduce their own costs. This gives them the right to refuse help if a customer makes a record of their identification details, either because they do not know the rules or out of necessity.

Mrs Branscombe said she struggled to remember her Pin and had it with her because she was visiting great-grandchildren. The thieves made withdrawals for £200 and £100 and a failed attempt for £50. Santander refused to pay compensation because the Pin was entered correctly.

Mrs Branscombe said: “Along with the £300 from our card, there was £100 in cash in my wallet, which is a lot of money when you’re a pensioner. It was an awful shock.”

She believed her Pin was well disguised in her diary and was sure she must have been watched while entering her Pin to pay for her groceries.

Mr and Mrs Branscombe’s daughter, Angela Ellis, wrote to Santander, the ombudsman service and this newspaper, asking the bank to reconsider. Santander eventually agreed to refund the money and paid an additional £30 as a goodwill gesture.

A spokesman said Santander advised customers not to write down or record their Pin, personal security details or personal information.

“In order to help customers remember personal details, they can change a Pin to a more memorable number, and we also offer multichannel credentials so customers can have the same details for both online and telephone banking,” the spokesman added.

“Power of attorney is an option, in particular for older customers, who may want help from a trusted friend or family member to remember their login details.”

Don't miss: Clever tricks to remember your passwords

Have you been denied compensation for fraud because you recorded your Pin or log-in details? Telegraph Money wants to hear from you. Email nicole.blackmore@telegraph.co.uk or write to us at 111 Buckingham Palace Road, London, SW1W 0DT.

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