Partially upheld: authorised push payment scam / failure to prevent fraud complaint against Santander UK Plc

Decision detail

Summary

Mr P was scammed by fraudsters impersonating an airline on social media. He was tricked into downloading a money transfer app and making four payments totalling £9,872 to what he believed was a refund process. After realising the scam, Santander refused to refund the payments. The ombudsman found that while the payments were authorised, Santander should have intervened before the fourth payment (£4,936) due to an uncharacteristic pattern of significant transfers to a new payee. Intervention would likely have prevented the scam. However, Mr P bore some responsibility for missing red flags, so the ombudsman ordered Santander to refund 50% of the fourth payment (£2,467.56) plus interest.

The Ombudsman's reasoning

The ombudsman found the payments were authorised as Mr P consented to them, though he was deceived about their purpose. However, banks have a regulatory duty to look out for fraud and take additional steps in certain circumstances. By the fourth payment, a concerning pattern emerged: a series of significant payments totalling almost £10,000 to the same new payee in quick succession, which were uncharacteristic of Mr P's account usage and indicative of fraud. Santander should have contacted Mr P directly with probing questions before processing the fourth payment. Such intervention would likely have uncovered the scam, as Mr P was unaware he was authorising payments (not receiving refunds). However, Mr P bore some responsibility due to red flags he should have noticed (low follower count on fake account, need to set up new account for refund, being told steps were for receiving refunds not making payments). Therefore, responsibility should be shared 50/50.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website