Not upheld: scam claim - Authorised Push Payment (APP) / refund request complaint against Nationwide Building Society

Decision detail

Summary

Miss L paid a builder (A) over £10,000 in three instalments between April and October 2024 for building work that was never completed. She claimed this was a scam and requested Nationwide refund her money under the CRM Code and Reimbursement Rules. Nationwide declined, treating it as a civil dispute. The ombudsman upheld Nationwide's decision, finding that while Miss L did not receive the promised work, the evidence did not establish that A intended to defraud her from the outset. The beneficiary bank activity showed legitimate building trade operations, A was registered on Companies House, multiple other customers made payments without complaint, and A continued communicating with Miss L—all factors inconsistent with a deliberate scam. The ombudsman concluded this was a private civil dispute (breach of contract) rather than an APP scam, which falls outside the scope of the CRM Code and Reimbursement Rules.

The Ombudsman's reasoning

The ombudsman applied the CRM Code (for payments before 7 October 2024) and the Reimbursement Rules (for the final payment after 7 October 2024), both of which explicitly exclude private civil disputes from coverage. An APP scam requires proof that the customer was deceived into transferring funds for a fraudulent purpose or to a different person than intended. Here, Miss L paid the person she intended (A) for the stated purpose of building work. While the work was not completed, the evidence did not establish that A had no intention to complete the work from the outset. The beneficiary bank activity showed legitimate building trade operations and multiple other satisfied customers. A's continued communication with Miss L was atypical of fraudster behaviour. The lack of substantive investigation or charges by Action Fraud further supported that fraud was not the most probable explanation. The ombudsman concluded this was a private civil dispute (breach of contract/poor service) rather than criminal fraud.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website