German banks and savings banks frequently clash with their private customers over payment fraud. While complaints about typical issues like account management or old premium savings contracts are gradually decreasing, the ombudspersons of savings banks, cooperative banks, private banks, and the financial supervisory authority BaFin unanimously report a high number of fraud cases. Customers often demand refunds from the institutions.

Jana Hähnel, Head of the Ombudsman Office at the German Savings Banks Association (DSGV), recognizes a "significant increase in arbitration requests for online banking damage cases." The ombudspersons at the Federal Association of German Cooperative Banks (BVR) note that bank customers "frequently reported that tricksters gained access to personal access data and made abusive transactions involving significant amounts."

Customers also often fall for false payment requests, as noted by the ombudspersons for private banks. "Applicants increasingly demanded the refund of payments they initiated and authorized due to fraudulent actions." The ombudspersons at BaFin see "numerous fraud cases" arising from digitization.

The work of ombudspersons is valuable as an alternative to time-consuming and lengthy court proceedings. Ombudspersons, often with prior experience in the judiciary, justice ministries, or universities, bring authority even though their suggestions are formally non-binding. They provide detailed descriptions of typical dispute cases, offering guidance. However, in fraud cases, they can often do little for customers.

When private individuals fall for scammers and transfer money to them, the victims have little leverage against the bank. "Applicants often have misguided expectations regarding the role of a bank as a business partner in a payment service contract with the customer," write the BVR ombudspersons. "In the case of the customer authorizing a payment service, it is the bank's responsibility to fulfill the respective payment order."

Ombudspersons from the Sparkasse describe a common fraud scheme: Phishing in online classified ad markets. Fraudsters send victims a link for supposedly quick payment processing, where victims enter their data. Afterward, the account is emptied. According to the report, the pages look "deceptively real."

However, the Sparkasse ombudspersons are clear in one case example: A customer acted "grossly negligent" when entering her data through a false "Ebay Instant Pay" function. The customer demanded €2,302 from the Sparkasse, which was declined – a decision deemed correct by the ombudspersons. Private bank ombudspersons also reached a similar verdict in another case.

It's a different situation when scammers spy on someone entering their PIN at an ATM, then steal the card and withdraw money. Here, the cooperative bank ombudspersons recommended an institution to refund the amount. Apparently, the affected customer did not act grossly negligent, as per the activity report.

Fraud cases dominate the statistics: In payment transactions, where cases are recorded, the number of applications against savings banks alone rose from 161 to 956 in the annual comparison. In the cooperative bank sector, the number increased from 112 to 272.

Nonetheless, fraud is not always involved. Private bank ombudspersons apparently dealt with numerous applications against Postbank, which angered many customers with technical glitches. While the ombudspersons do not mention the institution by name, the bank's failed IT transition resulted in numerous complaints to BaFin and consumer centers.

The ombudsman office of private banks alone counted 9,336 cases in payment transactions, representing about three-quarters of all requests in the past year. Savings business stands out with 1,072 complaints. "The high number of cases was due to frequent problems with online banking/account access or delays in executing customer orders," state the ombudspersons. "Many problems described were, however, resolved during the course of the arbitration process."

Savings banks and cooperative banks are still dealing with old dispute cases, even as the overall number of applications decreases. Many customers demand refunds when the bank increased account fees in previous years without obtaining the explicit consent of the customer – a practice the Federal Court of Justice overturned with its AGB ruling in April 2021. The question of the statute of limitations on claims, i.e., how far back customers can reclaim overpaid fees, is still unresolved, write the cooperative bank ombudspersons. Nevertheless, many banks failed to invoke the statute of limitations in disputes (pleading the statute of limitations).

The Federal Court of Justice triggered a wave of complaints with a ruling several times, before the number of applications subsided again. In 2014, the ombudspersons of private banks alone received around 108,600 applications after the court declared credit processing fees illegal. The AGB ruling led to a new surge in applications, and judgments related to ancient savings contracts kept the ombudspersons busy for a long time.

The ombudspersons of savings banks are optimistic that applications for fraud cases will decrease this year. The financial group is investing in technology for fraud detection, and the ombudspersons warn against the latest scams, according to Director Hähnel. "The higher the education and awareness of the population, the fewer opportunities fraudulent individuals have to access the necessary data." Hopefully, this means less work for the ombudspersons.