Not upheld: scam / fraud prevention failure complaint against Revolut Ltd

Decision detail

Summary

Mr R lost £113,124.47 in a property investment scam operated by company 'C', who held an account with Revolut. Mr R complained that Revolut should have prevented the loss by detecting the scam and stopping the account. The ombudsman accepted that company 'C' was operating a scam but found that Revolut, as the recipient bank, owed Mr R no duty of care as he was not their customer. The ombudsman found that Revolut had properly conducted due diligence at account opening, was proactively monitoring the account, and that the account activity appeared sufficiently legitimate (including regular council tax payments and business documentation) that even heightened scrutiny would not have revealed the scam. The complaint was not upheld.

The Ombudsman's reasoning

Although the ombudsman accepted that company 'C' was operating a scam, this did not automatically entitle Mr R to a refund from Revolut. Mr R was not a Revolut customer and Revolut owed him no duty of care. While Revolut had broad obligations to prevent fraud and financial crime, the ombudsman found no failure in these obligations. The account opening process was properly conducted with valid identification and passed checks. Revolut was proactively monitoring the account and the decisions taken were reasonable based on available information. Even if Revolut should have been more suspicious, the account activity appeared sufficiently legitimate (with plausible business documentation, council tax payments, and responses to information requests) that closure would have been the only reasonable action, and this would not have prevented the scam as company 'C' operated accounts elsewhere. The payment itself was not notable in the context of existing account usage patterns, and by the time Revolut became aware of the problem, only a nominal amount remained in the account.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website