Not upheld: scam reimbursement - Authorised Push Payment (APP) complaint against Santander UK Plc

Decision detail

Summary

Mr K lost £130 to a scam when purchasing a golf club from an online marketplace seller. Santander refunded £30 after deducting a £100 excess permitted under the Faster Payments Scheme Reimbursement Rules. Mr K complained that Santander should refund the full amount. The ombudsman found that Santander was entitled to apply the excess under the Reimbursement Rules and had no cause to suspect fraud at the time of the payment. The ombudsman noted that while Mr K was a victim of a scam, neither he nor Santander were at fault, and the Reimbursement Rules represent a regulatory requirement that provides Mr K with more protection than he would otherwise have received. The complaint was not upheld.

The Ombudsman's reasoning

Under the Payment Services Regulations 2017, Santander was entitled to process the authorised payment and Mr K was presumed liable in the first instance. However, the Faster Payments Scheme Reimbursement Rules (effective from 7 October 2024) require reimbursement of APP scam victims, but permit sending PSPs to apply an excess of up to £100 per claim. Santander was entitled to exercise this discretion. The Contingent Reimbursement Model (CRM Code) was no longer in place at the time of the payment. There was no evidence Mr K met the vulnerable customer exception. Santander had no cause to suspect fraud and reasonably processed the payment without further checks. The ombudsman found neither Mr K nor Santander were at fault; the scammer alone benefited from the dishonest deception.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website