Not upheld: Withdrawal of funds under coercion / Failure to identify vulnerability and prevent financial harm complaint against Skipton Building Society

Decision detail

Summary

Mr L complained that Skipton Building Society should reimburse him for six LISA withdrawals totalling £10,154.17 made between August 2021 and September 2022, which he later disclosed were made under coercion during a controlling relationship. Skipton declined to refund the amounts, treating the withdrawals as authorised. The ombudsman found the withdrawals were technically authorised by Mr L and that Skipton was not on notice of his circumstances at the relevant time. Although Skipton should monitor for signs of financial harm, the ombudsman found nothing in the calls or withdrawal pattern that should have alerted them to the true situation. The complaint was not upheld, as Skipton cannot fairly be held responsible for losses caused by a third party's coercive actions.

The Ombudsman's reasoning

Under the Payment Services Regulations 2017, Mr L is liable for payments he made himself, and the withdrawals were authorised by him. While Skipton should monitor for signs of financial harm from fraud, scams, coercion or inappropriate influence, they were not on notice of Mr L's circumstances at the relevant time. The ombudsman found nothing in the calls or pattern of withdrawals that should have alerted Skipton to the true situation. Even if Skipton should have probed further, the ombudsman was not persuaded Mr L would have disclosed the truth at that time, and therefore Skipton cannot fairly be held responsible for losses arising from a third party's actions.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website