Not upheld: Authorised Push Payment (APP) Scam - Reimbursement Claim complaint against Bank of Scotland plc trading as Halifax

Decision detail

Summary

Mrs K invested £15,001 with company D in February 2018 and an additional £10,000 in June 2019, expecting guaranteed monthly returns. She received payments as expected until October 2021, when they ceased. D entered compulsory liquidation in November 2023, resulting in Mrs K losing £18,140. Mrs K claimed this was an APP scam and sought reimbursement from Halifax. The ombudsman found that while D's failure was concerning, the available evidence was inconclusive as to whether D intended to defraud investors or simply failed due to poor investment decisions or mismanagement. Without convincing evidence of dishonest deception, the complaint was not upheld.

The Ombudsman's reasoning

The ombudsman required convincing evidence that Mrs K was dishonestly deceived about the purpose of her payments (i.e., that they were criminally obtained). While D's failure and liquidation could indicate wrongdoing, the evidence was inconclusive and could also indicate financial mismanagement, negligence, or unsuccessful legitimate investment activity. The fact that Mrs K received returns for a period suggested D may have been operating as a genuine investment, even if ultimately unsuccessful. Without evidence that D intended to scam investors from the outset, the ombudsman could not conclude that an APP scam had occurred.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website