Not upheld: scam/fraud claim - authorised push payment (APP) - refusal to reimburse complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr and Mrs G invested £26,500 in property development opportunities through Company C (a security trustee) and Company H between May and June 2019. When both companies entered administration in 2022-2023, Mr and Mrs G reported the matter to Barclays as a scam in February 2024 and requested reimbursement. Barclays declined, characterising the matter as a civil dispute outside the CRM Code's coverage. The ombudsman upheld Barclays' decision, finding insufficient evidence of fraudulent intent or deception by the investment companies, noting Company C's regulatory status, operational history, and Company H's completion of building projects did not support a scam classification.

The Ombudsman's reasoning

The ombudsman applied the CRM Code definition of an APP scam, which requires both a misalignment between the customer's purpose and the scammer's purpose, and dishonest deception. The ombudsman found insufficient evidence to establish that Companies C and H intended fraudulent deception from the outset. Key factors included: unclear reasons for payments to Company C, Company C's regulatory status and operational history, Company H's completion of building projects, and absence of police investigation or substantial fraud evidence. The oddity of paying a security trustee directly was insufficient to establish fraud without supporting narrative.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website