Not upheld: scam reimbursement / APP scam claim complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr R complained that HSBC failed to reimburse £1,700 he paid to another party (X) following a road traffic accident, claiming he was blackmailed and coerced into making the payment. HSBC treated it as a civil dispute rather than a scam and declined reimbursement. The ombudsman upheld HSBC's decision, finding that the transaction did not constitute an APP scam under the relevant reimbursement rules because Mr R intended to pay X and the funds were more likely used for the intended purpose of repairing X's work van, as evidenced by text messages and Companies House records. The ombudsman also rejected Mr R's allegation of racial discrimination, finding no evidence that HSBC treated him differently based on race.

The Ombudsman's reasoning

The ombudsman applied the Faster Payments Scheme and CHAPS reimbursement rules, which exclude private civil disputes from APP scam reimbursement. The definition of an APP scam requires criminal deception, but the evidence showed Mr R intended to pay X (the recipient was correct) and the funds were more likely used for the stated purpose (van repairs). The text messages, Companies House records, and X's work profile corroborated that X genuinely needed his work van repaired. Mr R's change of mind after repairs had begun and his subsequent blocking of X's contact further indicated a civil dispute rather than a scam. The police's own assessment that this was a civil matter supported this conclusion.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website