Upheld: inadequate fraud prevention and insufficient scam warnings complaint against Prepay Technologies Ltd
Financial Ombudsman decision DRN-6348443 of 2026-05-11T00:00:00+00:00. inadequate fraud prevention and insufficient scam warnings complaint against Prepay Technologies Ltd. Outcome: Upheld.
Decision detail
| Reference | DRN-6348443 |
|---|---|
| Decision date | 2026-05-11T00:00:00+00:00 |
| Firm | Prepay Technologies Ltd |
| Product | electronic money account |
| Claim type | inadequate fraud prevention and insufficient scam warnings |
| Outcome | Upheld |
| Remedy | Prepay Technologies must pay Mr H compensation equal to: (A) 50% refund of each of payments 1-9 (totalling £5,227); plus (B) simple interest at 8% per year on each refunded amount from the date of the corresponding payment to the date compensation is paid. A 50% deduction was applied to reflect Mr H's own responsibility for not carrying out independent checks and proceeding despite being approached online with promises of extremely high returns. |
Summary
Mr H lost £10,454 to an investment scam after being contacted online about cryptocurrency trading signals. He made nine transfers from his Prepay Technologies account to a cryptocurrency exchange between August and September 2025, with the purchased cryptocurrency subsequently transferred to scammers. Although Prepay Technologies provided some warning before the first payment, the ombudsman found it insufficiently robust given the firm's knowledge of cryptocurrency investment scams. The ombudsman upheld the complaint, finding the firm should have provided more detailed warnings about common scam features and made additional enquiries. Compensation of 50% of the lost amount plus interest was awarded, with the 50% reduction reflecting Mr H's failure to conduct independent checks despite receiving suspicious online contact promising high returns.
The Ombudsman's reasoning
Prepay Technologies should have recognised Mr H was at risk of fraud based on the large payment amount and cryptocurrency destination, particularly given industry knowledge of cryptocurrency investment scams by 2025. While the firm did provide some warning, it was insufficiently robust and did not highlight common features of investment scams such as online contact, promises of high returns, fake platforms, pressure to invest more, and demands for fees. A more detailed warning with additional questioning would likely have alerted Mr H to the scam's hallmarks. The ombudsman rejected arguments about break in causation, noting the firm's responsibility to protect customers from foreseeable fraud risks and that Mr H's openness about the investment purpose suggested he would have been receptive to a proper warning.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Prepay Technologies Ltd, all decisions | 80 | 40% |
Source
Read the original decision on the Financial Ombudsman Service website