Not upheld: scam and fraud - refund claim complaint against NewDay Ltd trading as Fluid

Decision detail

Summary

Mr O complained that NewDay Ltd failed to refund £1,890 he lost to an impersonation scam where he was tricked into making three payments to a money remittance service account in his own name. Mr O also complained about service received after reporting the fraud and the impact on his credit file when his account balance exceeded the credit limit. The ombudsman found the payments were not suspicious in nature, being of low combined value and directed to a legitimate money remittance service, so NewDay reasonably processed them. The ombudsman also determined NewDay could not have recovered the funds and found no service failures. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the Payment Services Regulations 2017 framework, noting that while Mr O authorised the payments and is presumed liable in the first instance, NewDay should have intervened if the transactions suggested heightened fraud risk. However, the payments were not of unusually excessive value, were made on the same day with low combined value, and were directed to a legitimate money remittance service. These factors did not suggest Mr O was at heightened risk of fraud. Additionally, NewDay could not have recovered the funds as they were either already moved to scammers or in an account under Mr O's control. A chargeback or Section 75 claim would not have succeeded as the money remittance service provided the intended service.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website