Not upheld: fraud reimbursement claim under Reimbursement Rules complaint against Monzo Bank Limited

Decision detail

Summary

Mr S purchased a counterfeit mobile phone for £800 from a seller on an online marketplace and sought reimbursement from Monzo Bank Limited, claiming he was a victim of fraud. Monzo rejected the claim as a private civil dispute. The ombudsman considered whether the transaction fell within the Reimbursement Rules, which require firms to reimburse authorised push payments made as part of APP scams involving criminal fraud. Although the phone was confirmed counterfeit, the ombudsman found insufficient evidence that the seller knew the device was counterfeit and deliberately deceived Mr S. The seller's provision of identity documents, opening the box in Mr S's presence, and explanation that the device was received as a gift cast substantial doubt on dishonest intent. The ombudsman upheld Monzo's decision to reject the claim, finding it a private civil dispute rather than an APP scam.

The Ombudsman's reasoning

The ombudsman applied the Reimbursement Rules which require firms to reimburse authorised push payments made as part of APP scams involving criminal fraud or dishonesty. However, private civil disputes are excluded. The ombudsman found that while Mr S was sold a counterfeit phone, the evidence did not convincingly demonstrate that the seller knew the device was counterfeit and deliberately deceived Mr S. The seller's actions—providing identity verification, opening the box in Mr S's presence, and providing a receipt showing the device was received as a gift—cast substantial doubt on whether the seller acted with dishonest intent. The blocking of contact and use of an account not in the seller's name, while potentially indicative of fraud, do not rule out the possibility of a good faith sale. The ombudsman concluded there was sufficient doubt regarding the seller's intent to justify Monzo not being held liable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website