Banks recovered only 4.8 percent of funds stolen from customer accounts due to fraud last year. In a conversation with Izvestia, German Zubarev, the Deputy Governor of the Central Bank, shed light on why the recovery rate remained so modest and what factors influence the outcome. His remarks underscore the challenges banks face when trying to reclaim money that has been diverted through deception and fraud, especially in a landscape where criminals continuously adapt their tactics.
Zubarev explained that the share of rediscovered funds is constrained by the methods used by fraudsters and the behavior of victims. Social engineering has grown more sophisticated, and many individuals still fall prey to convincing techniques that lead them to disclose sensitive data or to transfer money under pressure. This dynamic creates a reality in which even prompt reporting may not guarantee full restitution, particularly when transfers occur promptly and voluntarily under manipulation. The central bank highlights this nuance to explain why total recovery remains limited despite robust security measures.
According to the latest discussions with industry observers, there is ongoing interest in a system that could simplify the return of non-cash funds stolen from citizens by scammers. The idea is to enable banks to pursue a complete reimbursement of the stolen amount without imposing extra conditions on the victim. The proposed approach would involve a dual-control mechanism: both the sender’s bank and the recipient’s bank would double-check suspicious transfers. In practical terms, this could empower a sending bank to remotely restrict access to a scammer’s account if the system’s database flags a problematic profile. Under such a regime, those who move funds through others’ accounts, often referred to as droppers, would be unable to conduct remote transactions, reducing further losses and deterring fraud networks.
Yet, current legislation remains a barrier: banks are not legally obligated to restore funds to fraud victims if the transfer occurred with the victim’s voluntary participation. Even when cybercriminals employ social engineering to pressure targets, the law has treated many such transfers as voluntary acts by the victims. This legal framework creates a gap between the intent to compensate victims and the reality of enforcement, leaving many people without automatic recourse despite the financial damage they suffer.
In response, the Central Bank has urged financial institutions to begin piloting mechanisms that would tighten verification and enhance protection against unauthorized transfers. The goal is to create safer channels for online transactions and to improve the odds that stolen funds can be traced and recovered. While the regulatory landscape still requires refinement, the push signals a clear prioritization of consumer protection, better risk controls, and a more resilient payment system that can respond to evolving fraud techniques. These efforts are part of a broader effort to align banking practice with the realities of a digital economy, where trust and security are essential to maintaining consumer confidence across North America and beyond.