Not upheld: scam/fraud reimbursement - authorised push payment (APP) fraud under CRM code complaint against National Westminster Bank Plc

Decision detail

Summary

P, a limited company, lost £125,010 to a scam involving an accountant who embezzled funds intended for investment. P requested reimbursement from NatWest under the CRM code, but NatWest declined. The ombudsman found that while P was indeed a scam victim, they did not qualify for CRM code protection because they employed more than 10 people and therefore did not meet the micro-enterprise definition. The ombudsman also concluded that NatWest could not reasonably have detected or prevented the fraud, as the payments appeared legitimate and consistent with P's account history. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the micro-enterprise definition from the PSRs, which requires fewer than 10 employees and turnover/balance sheet not exceeding €2 million. Although P met the asset threshold, the evidence showed P employed more than 10 people consistently across 2021-2023, and potentially more when linked enterprises were considered. Therefore P fell outside the scope of the CRM code. Additionally, the payments themselves did not appear particularly high-risk given P's transaction history, and there was no indication at the time that the investment was fraudulent, so NatWest could not reasonably have prevented the scam.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website