Not upheld: account closure and funds withholding; potential money laundering concerns complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr M complained that Barclays unfairly restricted and closed his account and withheld £60,085 in funds following receipt of seven payments from five third-party accounts in March 2024. Mr M explained the payments were from his uncle in Pakistan for vehicle purchase and provided supporting documentation and testimonies. Barclays maintained its decision was justified based on legal and regulatory obligations and its risk criteria. The ombudsman found Barclays acted fairly, accepting its confidential information about account use as more compelling than Mr M's evidence, and found the testimonies inconsistent and insufficiently verifying the claimed foreign sources. No compensation was awarded as the funds represented a loss to the uncle rather than Mr M.

The Ombudsman's reasoning

Barclays has strict legal and regulatory requirements to monitor accounts and may restrict or close them. The account terms and conditions fairly permitted these actions. While Mr M provided substantial information about the payments, the ombudsman found it did not satisfactorily verify the payees as the uncle's foreign sources. The two testimonies were not compelling due to inconsistencies in stated amounts and purposes. The ombudsman accepted Barclays' confidential information as more compelling than Mr M's evidence. Barclays had a legitimate basis for its decisions based on its risk criteria and regulatory obligations. The funds represented a loss to the uncle, not Mr M, so no compensation for third-party loss was appropriate.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website