Upheld: Fraud reimbursement (APP scams) complaint against Telefonica UK Limited trading as O2

Decision detail

Summary

Mr A discovered two unauthorized fixed sum loan agreements in his name opened by a fraudster in a Telefonica store in November 2025. When Mr A reported the fraud, Telefonica initially declined his claim, causing him distress and requiring him to obtain CCTV evidence to prove he did not apply for the borrowing. Telefonica eventually accepted the fraud claim, closed the accounts, and corrected Mr A's credit file, initially offering £100 compensation which was increased to £250 during the FOS investigation. Mr A sought further compensation citing emotional and practical impacts. The ombudsman upheld the complaint but found the £250 offer fair, acknowledging that while Telefonica's initial disbelief and delay caused distress, the primary cause of upset was the fraudster's actions rather than Telefonica's conduct.

The Ombudsman's reasoning

The ombudsman accepted that Mr A was a victim of identity theft and that Telefonica's initial rejection of his claim caused distress. While acknowledging the inconvenience Mr A experienced in obtaining CCTV evidence and the worry caused by missed payment information being reported to credit reference agencies, the ombudsman concluded that the majority of upset was caused by the fraudster rather than Telefonica. The ombudsman found that Telefonica's actions after being informed of the fraud were the relevant consideration, and that the £250 offer fairly reflected the distress and inconvenience caused by Telefonica's handling of the matter, particularly their initial disbelief and the delay in resolving the situation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website