Upheld: disputed transactions / alleged fraud complaint against Modulr FS Limited trading as Pockit Limited

Decision detail

Summary

Mr A disputed two transactions totalling £184.90 made from his Pockit account via Google Pay on 15 January 2026, claiming he did not authorise them. Pockit declined the fraud claim, explaining that the card was added to a Google Pay wallet on 27 December 2025 using SMS two-factor authentication sent to Mr A's phone number, and the same device was used to make the disputed transactions. During FOS investigation, Pockit agreed to refund the amount as a gesture of goodwill. The ombudsman upheld the complaint, finding that while Pockit initially acted fairly in declining the fraud claim based on the evidence, the refund offered was fair and reasonable in the circumstances, particularly given Mr A's personal difficulties. No further action was required beyond the refund already agreed.

The Ombudsman's reasoning

The ombudsman found that the SMS verification was sent to Mr A's registered phone number and was used to set up Google Pay on an Android device, which subsequently made the disputed transactions. In the absence of evidence explaining how an unauthorised party obtained the SMS or accessed Mr A's phone, and given Mr A's denial of involvement, the ombudsman concluded on balance that Mr A must have disclosed the message content or someone intercepted it directly from his phone. Without evidence of how this occurred, the ombudsman could not fairly conclude the transactions were unauthorised. However, Pockit's gesture of goodwill refund was deemed fair and reasonable in the circumstances, particularly given Mr A's personal difficulties.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website