Identity fraud can be difficult to put right. Not only do you have the hassle of proving you didn’t order products or spend money on your credit card for items you don’t recognise, but you also have to convince banks and companies to give you your money back.

If you’ve been a victim of identity fraud, you need to act quickly and work with your bank to make sure you get back any money that has been stolen from your account, or to claim back your money fraudulent spent on goods and services.

Identity fraud – getting back money stolen from your bank account

Identity theft gives criminals the means to steal money from your bank account. Your debit card details may have been stolen – either from online accounts or by cloning the card itself – or someone has transferred money from your account. This is different from credit card fraud because this is money you own that has been stolen from your bank account.

The good news is that you are protected under the Payment Services Regulations. This means that banks have to refund the entire amount that has been stolen as the result of identity fraud. Banks need to act quickly too, refunding the amount immediately to your account, or by the end of the following day from when you report the fraud.

Prevent identity theft: 12 ways to stop identity fraud

There are two catches. The first is that technically you could be liable for the first £50 in losses before you reported the fraud, though in practice most banks won’t make you pay. The second is sometimes the bank believes you have acted fraudulently or without due care – such as leaving your debit card unattended – even if that wasn’t the case. In this event, the bank can decide to further investigate the claim which can take a few days. They can also delay refunding you the stolen money until their investigation is complete.

Identity fraud and bank transfers – APP fraud

Unfortunately, it’s a little harder to recover lost money if you’ve transferred it to another party. Some scammers will trick you into paying for something, such as a holiday or buying for building work by transferring money directly to their account – known as Authorised Push Payment (APP) scams. By transferring money directly, you lose the protection available when you buy by credit card, for instance. The best advice is to never transfer money to someone you don’t know and insist on paying by card instead.

If you have transferred money to a fraudster by mistake, there is a chance you might be able to get the money back – but you need to act fast. Contact your bank as soon as you realise your mistake. Your bank should immediately try to get the money back from the moment you inform them. If the bank doesn’t do all it can to recover your money, you can complain to the Financial Ombudsman and recover some of the money that way.

According to a recent BBC report, banks typically pay back an average of just one-fifth of the money lost in a fraudulent transfer – leaving many people out of pocket. However, a new voluntary banking code could see customers fully reimbursed as long as they took all reasonable steps to prevent the fraud and weren’t negligent by, say, carelessly sharing their banking details. It would be up to the customer to prove they took all reasonable care, and the new code could come into force in 2019. Five major banks have already adopted the code, helping reduce the impact of APP fraud.

Avoid making payments using third-party wire transfer services such as Western Union or MoneyGram. Using these services is seen as voluntarily having paid out the money from your account and you won’t be able to claim a refund.

Still confused? Read our guide to understanding what is identity theft – spotting identity fraud.

Identity fraud buying goods and services – using Section 75

If you’ve purchased goods or services – either in person or online – using a credit or debit card, and the person selling them was using a fake identity and vanishes having never supplied the goods, you have far greater protection.

If you paid by credit card – The best advice is to always pay by credit card. If someone insists on a bank transfer, think twice before dealing with them. Using a credit card gives you automatic protection under Section 75 of the Consumer Credit Act. This makes the credit card provider equally liable if there’s a problem, such as goods not being sent (technically a breach of contract) or if you’ve been scammed (technically misrepresentation by the company.

Section 75 applies to any goods or services that you bought that cost between £100 and £30,000. The good news is that you don’t have to have paid the full amount on the card. Paying a deposit using a credit card will give you full protection for the entire purchase price, even if you paid the balance using different means.

If you’ve been scammed and the goods haven’t arrived, contact your credit card provider (usually your bank) and raise a Section 75 claim. Claims can take months to resolve and you’ll need to provide lots of detail as to what has happened. If the bank refuses to pay, contact the Financial Ombudsman to complain and they will investigate.

If you paid by debit card – Similar protections apply when using a debit card – called Chargeback – though the amount you can claim back is far less at just £100, and unlike Section 75 debit card protection isn’t actually protected in law. However, most banks subscribe to the Chargeback scheme.

Identity fraud – what to do if someone uses your name to commit fraud

Having your own accounts targeted is one thing, but it gets even more problematic if your name is used to falsely obtain new credit cards, buy products, take out loans or enter into credit agreements. If you don’t act quickly, you could be left facing bailiffs chasing you for outstanding debt for loans you never took out, a poor credit rating, and even county court judgements (CCJs) against your name.

Look out for warning signs that someone is using your details to commit fraud, such as unexpected letters or agreements from companies that you haven’t contacted. Check, also, for missing post as your letters and important documents such as new credit cards or passport could have been intercepted. If you think your post has been stolen, contact the Royal Mail Customer Enquiry Number on 03457 740 740.

You should also contact the major credit agencies such as Experian, Equifax and Callcredit. They can review your credit file with you, and if you spot applications for credit or loans that you did not apply for, you can ask for these to be removed from your file.

Make sure you contact your bank and the police. The latter is important as you can get a crime reference number that can bolster your case when dealing with bailiffs or companies, and more easily convince them you’re telling the truth. Your bank should be able to check your accounts with you for anything suspicious, as well as issue new cards.

It’s worth reporting the scammer to the Financial Conduct Authority (FCA) and Action Fraud by calling 0300 123 2040.

Watch out for the fraud recovery fraud scam

As if dealing with the original scam and identity fraud was bad enough, once everything is sorted you’ll need to be extra careful. Sometimes scammers try to con the victim a second time, such as by phoning and pretending to be the bank or the police checking for suspicious activity. They might request details such as your account number and PIN to check your account. They may also pretend they can recover any lost money for a fee and ask for your bank details to transfer the money to.

It’s a scam – your bank and police won’t contact you in this manner. If in doubt, hang up and call your bank directly. The same with any similar message via email – it’s best to delete it can call the bank directly with a number that you already have.