Not upheld: scam fraud - refund liability complaint against Lloyds Bank PLC

Decision detail

Summary

Miss M was the victim of a job task scam in December 2024 and lost money through payments made from her Lloyds account. She made some payments directly to third parties (which Lloyds refunded £1,100 for under the Faster Payment Scheme Reimbursement Rules) and others to her own account at Bank R, from which the scammers then accessed the funds. Lloyds declined to refund the payments to Miss M's own account, and the ombudsman upheld this decision. The ombudsman found that the payments were not unusual in value or pattern compared to Miss M's established transaction history and did not follow typical scam indicators, so Lloyds had no reasonable opportunity to intervene and prevent the loss.

The Ombudsman's reasoning

The ombudsman found that Miss M authorised the payments using the agreed procedure, and while she was deceived about their purpose, this does not make the transactions unauthorised under the Payment Service Regulations 2017. The payments to Miss M's own account at Bank R were not covered by the Faster Payment Scheme Reimbursement Rules. Although firms have a regulatory duty to protect customers from fraud, the ombudsman concluded that the payment values and patterns were not unusual enough to warrant intervention. The payments were consistent with Miss M's established transaction history and did not follow typical scam patterns, as they were interspersed with return payments from Bank R. Therefore, Lloyds could not reasonably have prevented the loss through intervention.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website