Not upheld: scam / authorised push payment (APP) fraud - refund claim complaint against Starling Bank Limited

Decision detail

Summary

Mr M paid £500 as a deposit to F&N for roofing work but became concerned after reviewing the company's online presence, which he believed contained fake reviews and inconsistencies. When F&N refused to refund the deposit and ceased communication, Mr M claimed he had been scammed and requested reimbursement from Starling Bank. Starling declined, treating it as a civil dispute. The ombudsman upheld Starling's position, finding that while some of Mr M's concerns had merit, the evidence did not establish that the payment was made for a fraudulent purpose. The ombudsman concluded the payment was made for the stated purpose (roofing deposit) to the intended recipient, and therefore did not meet the definition of an APP scam under the Faster Payments Scheme Reimbursement Rules.

The Ombudsman's reasoning

The ombudsman applied the Faster Payments Scheme Reimbursement Rules definition of an APP scam, which requires either that the recipient was not who the consumer intended to pay, or the payment was not for the purpose intended. The ombudsman found that Mr M paid the intended recipient (F) and the payment was made for the stated purpose (roofing deposit). While acknowledging factors that concerned Mr M (fake reviews, company dissolution, business inconsistencies), the ombudsman found these do not constitute conclusive evidence of fraud and could reflect disorganisation or incompetence rather than dishonesty. The ombudsman applied the civil standard of proof (balance of probabilities) and concluded fraud was not the most probable explanation, therefore the payment does not meet the definition of an APP scam.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website