Upheld: Wrongful CIFAS fraud marker lodgement complaint against Monzo Bank Limited

Decision detail

Summary

Mr Q complained that Monzo Bank Limited wrongfully lodged a CIFAS fraud marker on his account after closing it in February 2025. The marker was based on a fraud complaint from another Monzo customer who claimed to be a victim of a scam after paying for dropshipping business setup services. Mr Q explained he was helping his brother provide legitimate services and provided evidence of regular payments matching his testimony. The ombudsman found the evidence did not meet the CIFAS threshold for lodging a marker, as it suggested a commercial dispute rather than clear fraud, and instructed Monzo to remove the marker. No compensation was awarded as the ombudsman found the evidence was not completely clear, though Mr Q's main bank account remained accessible throughout.

The Ombudsman's reasoning

The ombudsman found that while Monzo had concerns about Mr Q's account activity, the evidence did not meet the CIFAS threshold for lodging a fraud marker. The CIFAS criteria require 'reasonable grounds to believe that an identified fraud or financial crime has been committed or attempted' with 'clear, relevant and rigorous' evidence. The ombudsman concluded the evidence suggested a buyer-seller dispute rather than clear fraud, and that Monzo's suspicion did not rise to the required standard. The mix of evidence, including the alleged victim's attempts to renegotiate prices throughout, indicated a commercial disagreement rather than a fraudulent scheme. The ombudsman noted Monzo should have given Mr Q an opportunity to explain before lodging the marker.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website