Not upheld: APP scam reimbursement claim / Payment made under duress complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr I complained that Barclays should reimburse £20,000 he paid to a supercar rental company (M) after associates of M threatened him and his family with violence at a wedding and family home. Mr I claimed the payment was made under duress and should be reimbursed as an APP scam. Barclays declined, stating the payment did not fall within fraud or scam categories. The ombudsman upheld Barclays' decision, finding that while Mr I was in a genuinely frightening situation, the payment does not meet the regulatory definition of an APP scam because there is insufficient corroborating evidence of the circumstances and because a payment made under direct threat to avoid immediate harm does not constitute an APP scam as defined in the Reimbursement Rules. The ombudsman noted that no regulations require banks to reimburse payments made under duress and that the matter is appropriately being investigated by police.

The Ombudsman's reasoning

The ombudsman concluded that while Mr I was clearly in a frightening situation, the payment does not meet the definition of an APP scam under the Reimbursement Rules because: (1) there is insufficient corroborating evidence that an APP scam occurred; (2) even accepting Mr I's testimony at face value, a payment made under direct threat of violence to avoid immediate harm does not constitute an APP scam as defined in the rules, as Mr I was aware of the purpose of the payment; (3) there is no evidence that the person(s) making threats had a different purpose for the payment in mind; and (4) no regulations require banks to reimburse payments made under duress, coercion or blackmail. While Barclays should have identified the payment as suspicious and intervened, such intervention would not have prevented the payment given the credible threats and genuine fear for family safety.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website