Not upheld: account closure and service failures complaint against THE CO-OPERATIVE BANK P.L.C.

Decision detail

Summary

Mr C complained that Co-op unfairly closed his account and provided poor service after multiple refunds from the same merchant triggered a review in April 2025. Co-op blocked the account, requested further information, and issued a 60-day closure notice while Mr C was on holiday. Mr C claimed the closure was unfair and that service failings, including unclear communication and issues with telephone banking, caused him significant distress, particularly given his disclosed vulnerability. Co-op accepted some service shortcomings and paid £300 compensation. The ombudsman found that Co-op's actions were necessary to meet regulatory Know Your Customer obligations and were fair under the account terms, and that the compensation already paid was appropriate despite acknowledging service could have been clearer.

The Ombudsman's reasoning

The ombudsman found that Co-op's review and blocking of the account were necessary to comply with UK regulatory obligations regarding Know Your Customer requirements and establishing the origin of funds. The evidence provided by Co-op in confidence was found to be compelling and justified the account block and subsequent closure. While service shortcomings were identified, particularly regarding clarity during phone calls and in the closure notice given Mr C's disclosed vulnerability, these did not render the underlying decisions unfair. The £300 compensation was considered appropriate for the service failings identified.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website