Not upheld: APP scam claim - refusal to reimburse complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr A paid a builder £60,500 across 14 payments for renovation work between February and August 2024. The builder's work was of poor quality, failed to meet specifications, and the property was deemed uninhabitable. Mr A reported the matter as an APP scam in April 2025 and requested reimbursement from HSBC. HSBC declined, treating it as a civil dispute. The ombudsman upheld HSBC's decision, finding that while the builder's conduct was poor, there was insufficient evidence the builder intended to scam Mr A at the time payments were made, particularly given the builder continued work for over a year after the final payment. Therefore, the CRM Code did not apply and HSBC was not required to reimburse.

The Ombudsman's reasoning

The ombudsman found that while Mr A authorised the payments and was aware funds would leave his account, the key issue was whether the CRM Code applied. The CRM Code requires proof that the recipient intended to scam the customer at the time payments were made. The ombudsman concluded that while Mr K's behaviour was concerning and the work was poor quality, the scale and duration of work undertaken (over a year, including months after the final payment) was not indicative of a scammer's behaviour. A genuine scammer would likely have ceased work and communication once Mr A stopped making payments in August 2024. The ombudsman was not persuaded it was more likely than not that Mr K intended to scam Mr A, therefore the CRM Code did not apply and HSBC was not required to reimburse.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website