Santander has revealed it is working with the Financial Ombudsman Service to understand the service's perception of what banks and their customers must do to prevent fraud.
During a Treasury select committee meeting held this morning (February 13) to tackle economic crime, Susan Allen, head of retail business banking at Santander UK, was asked questions about why it had taken a Fos ruling for the bank to reimburse a client £12,000.
She was asked by an MP why the bank had initially told a customer they were "grossly negligent" so they would not get their cash back.
Ms Allen insisted the bank took claims from customers that they had been conned out of cash "extremely seriously" and in light of the Financial Ombudsman Service ruling, had gone back through past cases to see if there was similar modus operandi and reimbursed others hit by the same scam.
She said: "Where the bank is at fault we will reimburse as quickly as possible.
"We and Fos have moved over time over what is expected for the customer to do. That is right as the nature of scams is changing.
"We have another 124 cases working through and on some of those, their (Fos) views have helped to shape our decisions."
Chris Rhodes, chief product and propositions officer of Nationwide Building Society, said Fos was using an "evolving definition of gross negligence" for banking customers.
Mr Rhodes said: "If you disclose your pin or are negligent in how you hold that pin then you will be liable. If you write your pin on your card or given your debit card to flatmates then you will liable for that loss.
"If you are duped into giving your security details away so called and given a fraudster one time passwords because you don't know what is going on you will be reimbursed. If you give your pin and password away then you left your keys to the house on the street.
"Claims are looked at on a case by case basis so your vulnerability is taken into account."
Santander's Ms Allen said: "We will take into account vulnerability.
"There are cases where the customer has repeatedly ignored warnings but we will consider vulnerability and there isn’t a blanket approach."
MPs on the Treasury select committee said they were looking into how to define vulnerability within the financial services sector.
Stephen Jones, chief executive of trade body UK Finance, said his organisation was developing a code to make banks more consistent in whether customers would be reimbursed.
He said: "If the customer is not satisfied the ombudsman is the appropriate place to go as a second line.
"The ombudsman only really needs to get involved if there is a dispute over whether fraud has taken place.
"Under the code, if there is an issue of liability and if the customer believes they did act with a level of care then they should have to refer to the Financial Ombudsman Service.