‘I sent £4,000 to a fake builder’: the APP reimbursement rules that apply
The question: “I paid a builder £4,000 by bank transfer for a garden wall. He did two days of work, asked for the rest up front for materials, and I have not heard from him since. The number is dead and the company was dissolved a month before he quoted. Can I get my money back from my bank?”
This is the kind of case this site exists to answer rather than a letter anyone sent, and it is written that way deliberately. The rules below are the real ones.
The direct answer: probably yes, and the deadline for your bank to decide is short. On these facts it looks like authorised push payment fraud rather than a job gone wrong, and APP fraud has been reimbursable by law since October 2024. But the distinction between those two things is the whole case, so read the next section before you call the bank.
Fraud or a civil dispute, and why it decides everything
The reimbursement rules cover payments where you were deceived into sending money to someone pretending to be someone they were not, or selling something that never existed.
They do not cover civil disputes. The Payment Systems Regulator is explicit: if you “pay a legitimate supplier for goods or services that are not received or are defective, where there is no intent to defraud”, that is a contract problem, not fraud, and your route is the courts or a trade body, not your bank.
So the same missing builder falls on either side of the line depending on facts you may not have noticed:
| Points towards fraud, and reimbursement | Points towards a civil dispute |
|---|---|
| The company was dissolved before the quote | The company is real and still trading |
| The phone number and email are dead | They are answering, badly |
| The account name did not match the business | Payment went to the business’s own account |
| No trace of the trader at the address given | The trader is traceable |
| Others report the same person and pattern | The dispute is about quality or delay |
In the question above, a company dissolved a month before the quote is close to decisive. That is not a builder who ran out of money in July. That is someone who took a deposit under a business that did not exist.
Why it matters: get this framing right at the start and the bank assesses it under the reimbursement rules with a five day clock. Get it wrong and it goes into a complaints queue as a dispute about workmanship.
What the rules actually give you
Payments on or after 7 October 2024. Before that date reimbursement was voluntary under an industry code, and outcomes varied by bank. The Payment Systems Regulator’s work on APP scams sets out how the requirement was built and how the cost is split 50:50 between the sending and receiving firms.
Up to £85,000 per claim, which the PSR says covers over 99% of claims. A £4,000 wall is nowhere near it.
Five business days. That is the expectation. Where the firm needs more from you it can stop the clock, but it must reach an outcome within 35 business days.
An excess of up to £100 may be deducted. It is optional, firms set their own, some charge nothing, and it cannot be applied to a vulnerable customer. On £4,000 that is the difference between £3,900 and £4,000 back.
Thirteen months to claim, from the date of the payment.
Faster Payments and CHAPS only, UK bank account to UK bank account. Card, cash and cheque payments have their own separate protections, which is worth knowing before you choose how to pay a deposit.
The one way you can still be refused
Your bank can decline if you were complicit in the fraud, or if you were grossly negligent.
The PSR’s own wording on this is worth quoting because it is more protective than most people assume: “Gross negligence is a high bar.” It is not the same as being careless, ignoring a warning, or feeling foolish afterwards. In practice, PSR figures show just 2% of claims are rejected on that ground.
The exception does not apply at all to vulnerable customers.
Why it matters: a great many people do not claim because they assume paying without checking counts against them. On the published evidence it usually does not.
The scale of this, so you know you are not unusual
The UK Finance Annual Fraud Report 2026, published on 15 June 2026, put total payment fraud losses at £1.28 billion in 2025.
| Measure | 2025 | Change |
|---|---|---|
| APP fraud losses | £576.4 million | up 19% |
| APP fraud cases | 248,070 | up 7% |
| Purchase scams | £118.1 million, 71% of all cases | up 20% |
| Investment fraud | £221.5 million | up 40% |
| Reimbursed to APP victims | £354.3 million, 61% of losses |
Purchase scams, which is the category a fake tradesman falls into, are 71% of all APP cases. It is the single most common way people lose money to fraud in this country.
Why it matters: 61% of APP losses were reimbursed, not 100%. The gap is mostly claims that fall outside the rules, which is why the fraud-or-dispute question at the top of this piece decides more cases than anything else.
What to do, in order
- Call your bank today and use the words “APP scam”. Not “a builder has let me down”. The first phrase routes it to the reimbursement process; the second does not.
- Report it to Report Fraud, the service formerly branded Action Fraud, and keep the reference number. Your bank will ask. It covers England, Wales and Northern Ireland, and the line is 0300 123 2040. In Scotland you report to Police Scotland on 101 instead.
- Gather the evidence for intent, not for quality. Companies House dissolution date, the dead number, the WhatsApp messages, the account name you paid, anything showing the business did not exist. That is what separates the two categories.
- Write down the date you reported it. The five business day expectation and the 35 business day backstop both run from your claim.
- If you are refused, go to the Financial Ombudsman Service. It is free, and refusal by the bank is not the end of it.
The counterweight
Two honest limits on all of this.
The rules cover the payment, not the project. If you get £4,000 back you are where you started, minus a garden that is now half a wall and a summer of it. Reimbursement is not compensation.
And the protection is jurisdictional. It applies to UK bank transfers over Faster Payments and CHAPS. Pay a deposit by international transfer or in cryptocurrency and none of the above is available to you, which is the most useful single sentence in this article for anyone about to pay a deposit rather than recover one.
Frequently asked questions
Does this apply if I paid by card? No. Card payments have their own protections, including chargeback and, above £100, Section 75 of the Consumer Credit Act on credit cards. For a £4,000 deposit a credit card is materially safer than a transfer.
How long do I have to claim? Thirteen months from the date of the payment.
Will I definitely get the full amount? Up to £85,000, minus an excess of up to £100 if your firm applies one. No excess can be applied to a vulnerable customer.
What if my bank says it is a civil dispute? Ask them to put that in writing with their reasoning, then take it to the Financial Ombudsman Service. The dissolution date of the company is the kind of fact that moves the categorisation.
Updated on 11 September 2026.
Sources
- Payment Systems Regulator, APP fraud reimbursement protections
- Payment Systems Regulator, our work on APP scams
- UK Finance, Annual Fraud Report 2026, published 15 June 2026
- Report Fraud, formerly Action Fraud
- Financial Ombudsman Service
Scam Signal explains the rules and the routes. It is not legal advice, and every case turns on its own facts.
