Not upheld: scam protection and irresponsible payment processing complaint against Monzo Bank Limited

Decision detail

Summary

Mr M complained that Monzo failed to protect him from an investment scam perpetrated by firm X, through which he lost over £110,000 between July and October 2022. Mr M sent funds from his Monzo account to an EMI account (R) which then transferred them to X via a crypto exchange provider. Although Monzo provided new payee and scam warnings, Mr M proceeded with the payments. The ombudsman found that while Monzo could have intervened further, such interventions would not have prevented the loss because Mr M was heavily influenced by X and actively circumvented banking controls by switching banks to avoid friction. The complaint was not upheld, and no refund was ordered.

The Ombudsman's reasoning

The ombudsman applied the Payment Services Regulations 2017 framework, recognising that while banks must monitor accounts and intervene in suspicious transactions, they must balance fraud prevention with minimising disruption to legitimate payments. The key finding was on causation: even if Monzo had provided further interventions, the evidence showed Mr M was so heavily influenced by X and so determined to continue the investment that he actively circumvented banking controls (switching banks, willing to sell his house, prepared to provide false documentation). Therefore, any additional intervention by Monzo would not have prevented the loss. The ombudsman also noted that recovery was impossible as funds were sent through an account in Mr M's own control and the scam was not reported until 2025, nearly three years later.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website