Not upheld: Fraud reimbursement (APP scams) complaint against HSBC UK Bank Plc trading as HSBC UK

Decision detail

Summary

Ms M complained that HSBC should refund money she lost to a dating website where she purchased credits and virtual gifts, believing the individuals she spoke to were real but later discovering they were fake profiles using AI-generated images. HSBC declined, stating it was a civil dispute and Ms M had willingly made the purchases. The ombudsman found insufficient evidence that the website was operating a scam and that HSBC would have had no reasonable prospect of success with chargeback or Section 75 claims. The complaint was not upheld, and the ombudsman concluded the loss was caused by Ms M's decision to pay the website rather than any failure by HSBC.

The Ombudsman's reasoning

The ombudsman applied the Payment Services Regulations 2017, noting that consumers are generally liable for authorised payments but banks have obligations to protect customers from fraud and scams. The key issue was whether Ms M had evidenced a scam. The ombudsman found insufficient evidence that the website was operating fraudulently or that HSBC was aware of or involved in any scam. Even if a scam had occurred, the ombudsman could not establish the actual loss because Ms M had used the chat function she paid for. The ombudsman also found that HSBC would have had no reasonable prospect of success with chargeback or Section 75 claims because the merchant had provided the services paid for.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website