Not upheld: fraud liability and scam refund complaint against Bank of Scotland plc

Decision detail

Summary

Mrs H lost £7,594.30 after being scammed by a fake holiday rental website. She made a bank transfer payment to company F (a genuine FCA-authorised payment services provider) in Euros to book a villa in Portugal. After payment, she discovered the villa was not available for rent. Mrs H claimed BOS should have intervened and prevented the fraud, but the ombudsman found that BOS had no grounds to suspect fraud as the payment was to a genuine company, confirmation of payee matched, and all information available to Mrs H appeared legitimate. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Payment Services Regulations 2017, noting that BOS is expected to process authorised payments. Although Mrs H was the victim of a scam, the payment was authorised by her. The ombudsman found that even if BOS had intervened, the scam would not have been uncovered because: (1) payment was made to a genuine FCA-authorised company; (2) confirmation of payee match was received; (3) Mrs H had verified S was a legitimate Spanish-registered company; (4) the price was reasonable; (5) the website and booking confirmation appeared professional and legitimate. Therefore, there were no red flags visible to BOS that would have suggested fraud.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website