Not upheld: fraud marker registration / misuse of facility complaint against Starling Bank

Decision detail

Summary

Mr T complained that Starling Bank unfairly loaded a CIFAS negative fraud marker against his name after he received £771 in fraudulent funds into his account in October 2023. Mr T claimed he had sold a laptop to a friend from the pub and received the payment legitimately, but provided no corroborating evidence such as conversations or sale documentation. The ombudsman found that Starling acted fairly in registering the marker because Mr T's explanation lacked supporting evidence, his subsequent unusual cash withdrawal pattern (£200 daily) contradicted his account of everyday spending, and his later statements suggested knowledge of the fraud. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while Starling must show reasonable grounds to believe fraud occurred and clear evidence of deliberate complicity, the evidence here supported the marker. Although Mr T provided an explanation (laptop sale), he supplied no corroborating evidence such as conversations with the buyer, sale documentation, or proof of the gift. The unusual cash withdrawal pattern (£200 daily for four days, unprecedented for Mr T) contradicted his account of everyday spending for a holiday, especially as he provided no link between the withdrawals and the holiday booking. Additionally, Mr T's later statement that he had thrown away his card and questioned how someone could withdraw cash suggested knowledge inconsistent with an innocent recipient of fraudulent funds. Starling followed proper procedure by contacting Mr T multiple times and giving him opportunity to explain, and the delay in contacting him was justified by the timing of the third-party bank's fraud report.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website