Not upheld: fraud prevention and scam protection / Authorised Push Payment (APP) fraud complaint against Revolut Ltd

Decision detail

Summary

V, a limited company, complained that Revolut failed to protect it from a scam involving companies D and P in a property rental investment venture. V made approximately £43,000 in disputed payments between August 2023 and early 2024. The ombudsman first determined that V was an eligible complainant as a micro-enterprise engaged in economic activity. However, the complaint was not upheld because the payments did not meet the definition of APP fraud - V was not dishonestly deceived about the purpose or destination of payments, as both parties' purposes were broadly aligned and V received what was invoiced. The ombudsman found that Revolut had no obligation to protect against bad bargains or contractual disputes, and that the largest payment (£13,250) was not sufficiently suspicious to require intervention given the account activity and common business payment patterns.

The Ombudsman's reasoning

The ombudsman found that V was an eligible complainant as a micro-enterprise engaged in economic activity. However, the complaint was not upheld because: (1) the disputed payments did not meet the definition of APP fraud as V was not dishonestly deceived about the purpose or destination of payments - both parties' purposes were broadly aligned and V received what was invoiced; (2) Revolut had no obligation to protect against bad bargains or contractual disputes; (3) the £13,250 payment, while the largest made, was not concerningly suspicious given the account activity leading up to it, the deposits building towards covering the invoice, and the fact that larger payments to new payees are common on business accounts; (4) there was no clear pattern of fraud forming on the account or other concerning risk factors that would have put Revolut on notice; (5) even if Revolut had questioned the payment, the ombudsman was not persuaded this would have prevented it, as Revolut's checks would have focused on legitimacy of purpose and correct details, and Mr K was under pressure to complete the payment.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website