Not upheld: Fraud reimbursement (APP scams) complaint against Monzo Bank Limited

Decision detail

Summary

Miss U complained that Monzo Bank Limited refused to refund transactions made by her sister using Miss U's device without explicit authorization. Miss U had lent her device to her sister while the sister's phone was being repaired, and the device had Apple Pay activated with access to a shared social media account linked to Miss U's card. The ombudsman found that by sharing the device, passcode, and access to linked accounts, Miss U had effectively authorized the payments even without explicit consent to each transaction. Under the Payment Services Regulations 2017, Monzo was entitled to hold Miss U liable for the transactions, and the complaint was not upheld.

The Ombudsman's reasoning

Under the PSRs, a bank can hold a cardholder liable for disputed transactions if the cardholder made or authorized them, or if the cardholder failed with intent or gross negligence to keep security credentials safe. By lending her device with Apple Pay activated, sharing her passcode, and allowing access to a linked social media account and potentially her third-party bank account, Miss U effectively authorized her sister to make payments even without explicit consent to each transaction. The ombudsman found it reasonable for Monzo to treat the payments as authorized given the level of access Miss U had provided.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website