Not upheld: unauthorised payments / alleged failure of duty of care complaint against TSB Bank plc

Decision detail

Summary

Mr K, on behalf of his late father Mr M's estate, complained that TSB Bank plc should refund unauthorised payments sent to his sister S in 2019. TSB refused, treating the matter as a civil dispute. The ombudsman considered whether the payments were made without Mr M's authority and whether TSB should have prevented them. On the balance of probabilities, the ombudsman found the payments were likely authorised or made with Mr M's knowledge, supported by the fact that S had formal authority on the account at other times and the account showed normal usage patterns. The complaint was not upheld as there was insufficient evidence that TSB would have discovered unauthorisation or been concerned enough to refuse processing the payments.

The Ombudsman's reasoning

Under the Payment Service Regulations 2017, customers are liable for authorised payments and providers for unauthorised ones. Payments can be authorised formally or informally, including through agency. On the balance of probabilities, the evidence did not clearly show the payments were made without Mr M's authority. The fact that Mr M granted S formal authority before and after 2019, combined with account usage patterns and lack of contemporaneous concerns, suggested the payments may have been made with his knowledge or consent. While the payments appeared uncharacteristic and Mr K raised concerns about undue influence, there was insufficient evidence that TSB would have discovered unauthorisation or been concerned enough to refuse processing had it made further enquiries.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website