Not upheld: scam - failure to prevent fraud complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr K lost approximately £429,444 to an investment scam between June 2020 and April 2023, sending funds via payment service provider T to a scammer he met through a friend. Barclays Bank stopped the first two payments and provided three automated warnings, but Mr K continued making payments by selecting 'friends and family' as the payment reason. The ombudsman found that Barclays' interventions were reasonable given Mr K's previous account activity, which included large payments to external accounts in his name, and that the payments to T became normalized as day-to-day activity over time. The ombudsman declined to uphold the complaint, finding Barclays was not responsible for the loss and that recovery would not have been possible as the funds went to an account in Mr K's own name.

The Ombudsman's reasoning

The ombudsman found that while Barclays had obligations to monitor for unusual transactions and fraud, the payments to T were not sufficiently unusual given Mr K's previous account activity, which included similarly large payments to external accounts in his name. The ombudsman considered that Barclays provided reasonable interventions by stopping the first two payments and requesting payment purpose information. The ombudsman noted that even if Barclays had intervened more frequently, Mr K would have provided the same 'friends and family' reason each time, and the payments became normalized as day-to-day activity over the extended period. The ombudsman also noted that recovery would not have been possible as the payments went to an account in Mr K's own name before being transferred to the scammers.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website