Not upheld: Other regulated complaint complaint against Social Money Limited

Decision detail

Summary

Mr A complained that Social Money Limited should refund £105,137.60 paid by third party B (claiming power of attorney) toward Mr A's secured loan debt. Mr A later claimed these funds represented a deposit owed to another third party C for a property sale. The ombudsman found that B clearly intended to repay Mr A's debt with apparent authority, making it reasonable for Social Money to accept the payments. The ombudsman lacked jurisdiction to consider losses suffered by third parties B and C, and found Mr A's subsequent explanations implausible. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman determined that B intended to pay Social Money on Mr A's behalf with apparent authority via power of attorney, making it reasonable for Social Money to accept the payments. The ombudsman lacked jurisdiction to consider losses suffered by third parties B and C, who are not customers of Social Money. The ombudsman found Mr A's subsequent explanations about the funds' nature and source to be lacking credibility and inconsistent with the payment evidence.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website