Not upheld: mistaken payment recovery / failure to recover funds complaint against Bank of Scotland plc trading as Halifax

Decision detail

Summary

Miss C made two mistaken online payments totalling £490 to a dissolved business in September and October 2024 while affected by prescribed medication and stress. Halifax contacted the recipient bank to recover the funds on a best endeavours basis, but the recipient bank refused to return them due to an outstanding debt. Miss C complained that Halifax should have done more and should have considered her vulnerabilities. The ombudsman found Halifax acted fairly by correctly processing the customer-authorised payments and attempting recovery, and that the recipient bank's refusal to return funds is not Halifax's responsibility.

The Ombudsman's reasoning

The ombudsman found that online banking payments are initiated directly by the account holder with no human involvement from the bank. Halifax correctly processed the payments using beneficiary details provided by Miss C. While banks should help recover mistaken payments on a best endeavours basis, there is no guarantee of recovery. Halifax fulfilled its obligation by contacting the recipient bank. The recipient bank's refusal to return funds due to an outstanding debt is not Halifax's responsibility. Miss C authorised the payments and Halifax processed them correctly.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website