13-month Reporting Limitation in the New MRR Regulation
In the 'Making change through Refundee' series, we aim to represent the interests of fraud victims by highlighting issues in the financial services industry that require greater awareness or reform. We believe fraud victims need a stronger advocate for change.
Refundee has been campaigning for reform or removal of the 13-month reporting limitation under the new MRR rules introduced by the Payment Systems Regulator (PSR) on the 7th October 2024.
We analysed 594 investment fraud cases that we represented that were reimbursed in full by their banks under the old CRM code (the regulation preceding the new MMRs). Refundee found that 66% of these cases would not have been reimbursed if they were instead covered by the new MMRs as they were reported outside of the 13 month reporting window.
This means that, particularly for investment fraud cases, the new MRRs are likely much worse for fraud victims than the old rules.
We predict that this issue is going to become increasingly problematic as it has only been 18 months (at the time of writing; April ‘26) since the MRRs were introduced. This means that there has only been a 5 month window for victims to realise that this problem impacts them. Many other investment fraud victims, who have already been scammed, simply don’t know it yet. We found that, on average, it takes investment fraud victims 26 months to report fraud because investments are typically long term in nature. People don’t expect to see immediate returns, so can’t report it within 13 months!
Let’s look at a real case study of a client that we are representing. We have changed her name for anonymity, but the details of the case are entirely accurate.
Sarah sought to invest £20,000 in late 2024 into a property company that had been recommended to her by her boss at work. Her boss had invested a few years prior, and had been receiving regular quarterly returns. Sarah is naturally cautious, and wanted to be confident that her investment was secure as this was her retirement money. She checked the company on Companies House, reviewed many positive reviews on Trustpilot, and felt confident because the company used an authorised solicitor to facilitate the investment process. Finally, since her boss had been receiving real returns, she felt that the investment was real.
On the 1st October 2024, Sarah invested an initial £1,000 deposit on the instruction of the company in order to secure her investment, and help with the Anti-money laundering checks that the company said that they needed to perform. She then made a second payment on the 21st October 2024 of £19,000 to make up the balance of her £20,000 investment. Both payments were from her Lloyds account.
Unfortunately, shortly after Sarah’s investment, the company told her that they were changing their repayment schedule from quarterly returns to annual returns. This meant that she would not expect any returns until at least 12 months later. When those returns didn’t happen, the company explained that they were financially struggling but were due to come back to investors with a plan. After many more excuses, however, it became apparent that no returns were going to be paid and Sarah became suspicious that she had been the victim of fraud. Through a long investigation, Refundee was able to prove that the company had been operating a Ponzi-like investment, and Sarah had been the victim of an investment scam.
By this point, Sarah was well outside of the 13-month reporting window to tell her bank Lloyds. She spent more than two hours on the phone telling them what happened. Lloyds explained that they would reimburse Sarah’s first payment of £1,000 as it was covered by the old regulation. The payment of £19,000, however, was actually covered by the new regulations which were brought in between her first and second payments. And as the new regulations have a 13-month reporting limitation that she had missed, they would not reimburse her £19,000.
This is despite the fact that both payments were to the same company, which Lloyds accepted as fraud, and were both made within 19 days of each other.
This case shows how absurd the 13-month reporting limitation is. It is unfair to victims of fraud, and allows banks to avoid the cost of reimbursement at the expense of their customers.
Refundee has submitted an extension report to the PSR, and we are calling for change to this rule. We think that the rule should be removed, and instead default to the DISP ‘six and three year rule’ where victims should be eligible for reimbursement if they report the fraud within six years, or within three years of when they should have been reasonably aware.
Our data was initially reported in the Financial Times and covered extensively by BBC Money Box and Dan Whitworth on Saturday 25th April 2026. We want the PSR to recognise the importance of this issue, and change the reporting rules so that investment fraud victims are not unfairly excluded.
Article was written by William Ayles, Director and Cofounder at Refundee
Date: 23rd April 2026