Partially upheld: scam loss reimbursement / failure to provide adequate warnings complaint against Wise Payments Limited trading as Wise

Decision detail

Summary

Mrs R lost £21,972 to an investment scam after clicking a social media advert and making five payments to scammers posing as a legitimate investment company. Wise intervened on two transactions but provided only a general scam warning that Mrs R, coached by scammers with exact wording to use, ignored. The ombudsman found Wise should have provided a tailored cryptocurrency investment scam warning by payment four, which would likely have prevented further losses. However, Mrs R shared responsibility for her loss due to multiple red flags she should have recognised, including an FCA warning about the fraudulent company, payments to individuals rather than a company, and being instructed to mislead her bank. The complaint was partially upheld, requiring Wise to reimburse 50% of payments four and five (£2,995.38) plus interest.

The Ombudsman's reasoning

Wise is an electronic money institute with a duty of care to exercise reasonable skill and care and be alert to unusual transactions that might indicate fraud. By payment two, Wise should have provided a general scam warning. By payment four (cryptocurrency transfer), Wise should have provided a tailored warning about cryptocurrency investment scams, which would have prompted Mrs R to reconsider given the combination of red flags present. However, Mrs R bears shared responsibility for her loss because: she could have discovered the FCA warning about the fraudulent company; she was asked to make payments to individuals rather than a company; she received no documentation; she was explicitly told to lie to her bank; and she received funds from individuals rather than the company to pay fees. A 50/50 split of liability is fair and reasonable.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website