Not upheld: scam reimbursement / authorised payment fraud complaint against NewDay Ltd

Decision detail

Summary

Mr B complained that NewDay Ltd refused to reimburse £2,700 he lost to an impersonation scam through three credit card payments made in February 2026. NewDay and the FOS investigator did not uphold the complaint, finding the payments were authorised and not sufficiently unusual to warrant intervention. The ombudsman upheld this decision, concluding that the transaction values, frequency, and legitimate merchant destination did not present obvious fraud indicators that should have triggered NewDay's scrutiny. The ombudsman also determined that post-scam recovery attempts through chargeback or Section 75 claims would have failed because the payments reached a legitimate merchant and the scammers broke the required debtor-creditor-supplier chain.

The Ombudsman's reasoning

The ombudsman agreed with the investigator that the payments were authorised by Mr B and were not sufficiently unusual or suspicious to warrant NewDay's intervention. The transaction values were not concerning, the destination was a legitimate organisation, and three payments over a short period did not indicate a pattern of fraud. NewDay could not reasonably have been expected to intervene before processing. Additionally, any post-scam recovery attempts through chargeback or Section 75 claims would have failed because the payments went to a legitimate merchant and the debtor-creditor-supplier chain was broken by the scammers' involvement.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website