Revolut customers say e-money firm failed them after being scammed

A business owner has reported a staggering £165,000 stolen from his Revolut account, claiming that the company’s security protocols fell short in preventing this theft.

The victim asserts that fraudsters successfully bypassed the ID verification process to access his account.

To date, Revolut has declined to refund the stolen funds.

In a troubling trend, data reveals that Revolut was implicated in more fraud reports in the last financial year than several major high street banks.

The e-money provider emphasizes its commitment to combating fraud, stating it implements “robust controls” to comply with legal and regulatory standards.

Revolut is part of a growing cohort of digital-only banks that deliver services exclusively online or via mobile apps, with no physical branches.

The firm has expanded rapidly, boasting over 45 million customers globally, including nine million in the UK. Its revenue nearly tripled to £1.8 billion in 2023, attracting users with quick account openings and favorable foreign exchange rates.

The victim, referred to as Jack, was drawn to Revolut for these features, especially as he manages an international business requiring multiple currencies.

He was initially reassured by the security features advertised by Revolut.

In February, while in a co-working space, Jack received a fraudulent call from someone posing as a Revolut representative, warning him about potential account jeopardy due to shared Wi-Fi usage.

Jack unwittingly disclosed sensitive information, enabling the scammers to link his Revolut account to their device, allowing visibility of his recent transactions.

During the call, Jack received a text from Revolut requesting verification for a recent purchase of £21.98 by entering a six-digit security code.

Believing he was confirming his identity, he provided the code to the scammers.

Unbeknownst to Jack, they had created a fraudulent account also labeled “Etsy” and by sharing the code, he authorized a payment to their account.

This led to two additional unauthorized payments, allowing them to set up multiple fraudulent recipients, draining his account.

Upon realizing the scam, Jack attempted to contact Revolut, but found there was no direct helpline—only a chat function hidden within the app.

He messaged, “I’ve been scammed, please freeze my account,” but it took 23 minutes to reach the appropriate team, during which an additional £67,000 was drained from his account.

Now facing a loss of £165,000, Jack believes Revolut’s systems inadequately protected him, particularly in bypassing facial recognition software linked to new device access.

Jack requested proof of the image used to authorize the new device but was informed that it wasn’t stored in their system. This left no evidence of the fraudsters’ actions.

Investigation into this potential vulnerability has reportedly led to fixes.

Jack criticized Revolut for failing to flag the rapid sequence of 137 payments made to newly added payees in such a short interval.

Experts assert that banks generally monitor accounts for unusual transaction patterns, with fraud specialists emphasizing the need for proactive customer engagement in flagged situations.

In the previous year, the UK’s fraud reporting center received nearly 10,000 fraud complaints linked to Revolut, according to a Freedom of Information request.

This number surpasses reports for major banks, highlighting growing concerns over the e-money firm’s ability to safeguard customers.

A review involving former employees revealed ongoing issues related to Revolut’s focus on aggressive growth, often placing fraud prevention on the back burner.

While fraud remains a challenge across the banking sector, improvements in technology have not eliminated the problem—prompting financial institutions to adopt additional security measures that sometimes complicate customer experiences.

Revolut asserts its commitment to customer protection and the establishment of new risk assessment processes for product launches.

In 2023, the Financial Ombudsman received approximately 3,500 complaints regarding Revolut—signaling that customers feel inadequately protected.

Consumer advocates stress the importance of caution when banking significant amounts with Revolut, citing its track record of hesitating to reimburse fraud victims.

Despite regulatory changes aimed at ensuring refunds for victims of fraud, there is concern that Revolut may struggle with compliance.

“Customers consistently report being advised to set up Revolut accounts during scams, indicating a potential vulnerability in the platform,” stated a fraud recovery specialist.

This July, Revolut was granted a provisional banking license, positioning the institution for future customer deposit protections.

Once fully operational as a bank, customers will be guaranteed deposits up to £85,000, enhancing the stakes regarding consumer protection.

There are speculations regarding the potential implications for Revolut’s licensing amid their expanding size poised to rival traditional banks.

While Revolut maintains compliance with regulatory standards, longstanding concerns over fraud incident management persist.

• Report any fraud through the Financial Ombudsman Service for assistance and potential compensation.
• As of October 7, 2024, new regulations ensure mandatory reimbursements for most UK money transfers, capping up to £85,000.
• These measures cover individuals, small businesses, and certain charities, specifically excluding international transfers and cryptocurrencies.
• Additional resources on fraud reporting are available through dedicated consumer advocacy groups.