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

Decision detail

Summary

Ms M paid a builder £28,000 for home renovation services but discovered the work was incomplete, of poor quality, and unsafe, and that the builder lacked claimed qualifications. She claimed this was an Authorised Push Payment scam and sought reimbursement from Starling Bank. Starling declined, characterising it as a civil dispute. The ombudsman upheld Starling's decision, finding that although Ms M was misled about the builder's competence, the payments went to the intended recipient for the intended purpose, and the builder's substantial work progression was inconsistent with scam behaviour, making this a civil matter rather than a qualifying APP scam under the Faster Payments Scheme reimbursement rules.

The Ombudsman's reasoning

The ombudsman applied the FPS reimbursement rules definition of an APP scam, which requires either that the recipient is not who the consumer intended to pay, or the payment is not for the purpose intended. The ombudsman found that Ms M paid the person she intended to pay (the builder) and both parties intended the payments for renovation works. Although Ms M may have been misled about the builder's qualifications and received poor quality work, this constitutes a civil dispute rather than a scam, as the builder attended the property and substantially progressed work over time, which is atypical of scam behaviour where little to no work is usually completed.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website