Finnish banks attribute online fraud to customer negligence as losses reach €100 million

Finnish banks often attribute online fraud to customer negligence, as revealed by recent findings. In 2022, banks reimbursed only 4% of unauthorized transactions, leaving customers to bear the brunt of 92% of the losses. The Bank of Finland has been collecting data since 2022, which found that banks’ liability stood at 8% while customer liability was at 85%.

Fraud cases have surged in recent years, with financial reports estimating that such scams could lead to losses as high as €100 million in Finland within the year. The international nature of these crimes makes capturing offenders a rare occurrence. Disagreements often arise between banks and victims regarding who is responsible for the lost funds. The Payment Services Act holds the service provider—the bank—accountable, unless the customer approved the transaction or acted with gross negligence.

An analysis of over a hundred cases showed that banks frequently invoked these exceptions to deny claims. The financial sector’s representative stated this approach aligns with Finnish law, although the legal framework is ambiguous, complicating customer understanding of what constitutes gross negligence. Many victims argue that banks should share some responsibility, particularly regarding large outgoing transfers to foreign accounts.

In contrast, countries such as Sweden, the UK, and the Netherlands impose greater liability on banks for fraud losses. Changes proposed in EU legislation could tighten these rules in Finland as well, but the financial sector is opposing them, arguing that reimbursement does not deter criminal activity and can inadvertently fund international crime operations.

Few customers take legal action against banks, with disputes often settled by the Insurance and Financial Ombudsman. Recent cases highlight the tense dynamics between customers and banks, as well as significant legal risks involved in pursuing claims.