Not upheld: scam / fraud - failure to prevent authorised payment to scammer complaint against HiFX Europe Limited (trading as XE)

Decision detail

Summary

Miss H complained that XE refused to refund €16,206.40 she lost when she was scammed into transferring funds through XE's foreign exchange service to a fraudulent investment account in April 2025. An investigator partly upheld the complaint, recommending 50% reimbursement, but the ombudsman disagreed. The ombudsman found that while XE owes a duty of care, the circumstances of the payment (large value, new payee, FX context) did not reasonably require intervention, and Miss H's selection of 'bill payment' rather than 'investment' as the purpose prevented XE from asking further questions. The ombudsman concluded that even if XE had intervened, it would not have prevented the loss given Miss H's demonstrated pattern of misrepresenting transaction purposes under the scammer's instruction. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while XE owes a basic duty of care to customers and should reasonably intervene where there are circumstances indicative of fraud risk, the specific circumstances of Miss H's payment did not reasonably require further intervention. The payment size and transfer to a new payee were not inherently unusual for a foreign exchange provider. Critically, Miss H selected 'bill payment' rather than 'investment' as the purpose, which prevented XE from asking further questions. Even if XE had intervened, the ombudsman was not persuaded it would have prevented the loss, given Miss H's pattern of misrepresenting transaction purposes across multiple lenders under the scammer's instruction. The ombudsman also found XE made reasonable recovery efforts but was limited by the funds having been transferred to a Hungarian bank account.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website