Not upheld: authorised push payment (APP) scam - reimbursement claim complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr B lost £4,040 to a crypto investment scam operated by Company H between September and November 2021, making payments through a concierge service (V) from his HSBC account. He requested reimbursement under the CRM Code, arguing HSBC should have intervened based on the payment pattern and crypto-related nature. The ombudsman found the CRM Code did not apply because V was not complicit in the scam and acted with legitimate intent, and that the payments were not sufficiently unusual or suspicious to require HSBC intervention. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while Mr B lost money to a scam perpetrated by Company H, the CRM Code only applies to APP scams where the recipient's purpose is fraudulent. V's purpose was legitimate as she intended to transfer the funds to Company H as agreed. The payment to V was not sufficiently unusual or suspicious to require HSBC to intervene, as new payees are routinely added to accounts, the payment amount was not significantly abnormal, and there was a substantial gap between payments. HSBC had no way of knowing the payment related to a crypto investment and therefore could not reasonably have identified fraud risk.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website