Not upheld: scam and fraud - refund claim complaint against Starling Bank Limited

Decision detail

Summary

Mr L complained that Starling Bank refused to refund payments he made to his nephew for vouchers in what turned out to be a scam. The nephew admitted using the money to gamble instead of providing the promised vouchers and refunds. Starling classified the matter as a civil dispute rather than a scam and declined to refund. The ombudsman found that while Mr L was indeed a scam victim, he received sufficient refund payments and vouchers in return that, when totalled, exceeded his original payments, resulting in no net financial loss. Therefore, the complaint was not upheld and no refund was ordered.

The Ombudsman's reasoning

The ombudsman applied the principle of putting the consumer back in the position they would have been in had the scam been prevented. However, the ombudsman determined that when assessing Mr L's position, all benefits received must be considered alongside losses suffered. Since Mr L received refund payments and vouchers with tangible value that he used to purchase goods and services, and the total value of these benefits exceeded the payments he sent, he suffered no net financial loss. Therefore, it would not be fair to require Starling to refund any payments.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website