Partially upheld: inadequate fraud prevention and scam detection - failure to intervene effectively despite fraud alert complaint against Santander UK Plc

Decision detail

Summary

Mrs K fell victim to a flight booking scam after contacting a fraudster posing as a travel agent from Company S. When she attempted to pay £1,388.24 via her Santander debit card, the payment was initially declined due to suspected fraud. After calling Santander, an agent confirmed the payment was flagged for fraud but allowed it to proceed once Mrs K confirmed she was authorising it. The ombudsman found that while Santander's fraud detection system worked correctly, the agent's intervention was inadequate because it failed to ask probing questions or provide scam warnings despite the fraud alert. However, Mrs K also bore responsibility for not recognising warning signs such as two declined payments and paying a different company than the one she originally contacted. The ombudsman partially upheld the complaint and ordered Santander to refund 50% of the loss (£694.12) plus interest, with liability split between both parties.

The Ombudsman's reasoning

The ombudsman found that Santander's fraud prevention system correctly identified fraud risk and blocked the first payment attempt. However, the agent's intervention was ineffective because it only confirmed Mrs K was making the payment (appropriate for suspected compromised card) but failed to ask probing questions, provide scam education, or detect fraud when the actual risk was a general suspicion of fraud. The ombudsman determined that if the agent had properly questioned Mrs K about the company name, how she contacted them, and legitimacy, combined with the red flags (declined payments, fraud alert, paying different company), the scam would likely have been uncovered. However, Mrs K also bore some responsibility through contributory negligence for not recognising warning signs (two declined payments, fraud mention, paying different company). Therefore, liability was split 50/50.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website