Not upheld: Irresponsible lending complaint against National Westminster Bank Public Limited Company (NatWest)

Decision detail

Summary

Mr D complained that NatWest failed to identify his problem gambling and irresponsibly granted him a £1,000 overdraft facility in June 2025, which he subsequently used for gambling. NatWest had identified only approximately £50 of gambling transactions in May 2025, which did not meet its lending decline threshold, and Mr D's account showed no signs of financial difficulty prior to the application. The ombudsman found that while Consumer Duty requires firms to consider vulnerabilities, banks are not expected to actively monitor accounts for gambling activity or unilaterally apply gambling blocks without customer consent, and are only likely to intervene when made aware of problems or when accounts show difficulty. Since Mr D did not disclose his gambling issues until after raising his complaint and his account showed no signs of distress, the ombudsman did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that NatWest's decision to grant the overdraft was reasonable based on proportionate checks showing no missed payments, adverse credit information, or financial difficulty. While acknowledging that Consumer Duty and FCA Principle 6 require firms to consider customer vulnerabilities, the ombudsman noted that banks cannot unilaterally apply gambling blocks without customer consent and are not expected to actively monitor accounts for gambling activity as it is legitimate. The ombudsman concluded that banks are only likely to act on potential vulnerability when made aware of a problem or when an account shows signs of difficulty, neither of which applied here since Mr D did not disclose his gambling issues and the account showed no signs of distress.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website