Not upheld: failure to prevent authorised push payment scam through inadequate intervention and warnings complaint against Bank of Scotland plc trading as Halifax

Decision detail

Summary

Mr M lost £7,500 to an investment scam after making an international transfer from his Halifax account on 24 September 2024. He claimed Halifax should have intervened with warnings given the transaction's risk factors and his alleged vulnerabilities from bereavement and financial stress. Halifax refused to refund, citing that the payment was not unusual given Mr M's transaction history and that it was not covered by the CRM code as an international payment. The ombudsman found Halifax should have intervened with automated questions and warnings but concluded such intervention would likely not have prevented the payment, particularly given that Mr M proceeded with further investments in November 2024 despite receiving explicit warnings from his EMI. The complaint was not upheld.

The Ombudsman's reasoning

While Halifax should have intervened with automated questions and warnings given the risk factors (significant amount, new payee, overseas destination), the ombudsman was not persuaded such intervention would have prevented the payment. The key reasoning was that: (1) many common investment scam features were absent from this case; (2) Mr M had already conducted research and found mixed reviews but proceeded anyway; (3) when Mr M's EMI provided explicit warnings in November 2024, he still went ahead with further investments; (4) there were inconsistencies in Mr M's account suggesting he might not have answered questions accurately; and (5) the investment returns, while high, were not unrealistic enough to alarm an inexperienced investor. Therefore, an automated warning from Halifax in September was unlikely to have been more successful than the direct intervention Mr M received from his EMI in November.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website