Not upheld: fraud prevention and scam protection - investment scam complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr and Mrs S complained that Barclays failed to protect them from a fraudulent investment scam in 2014, where Mr S made three payments totalling £350,000. Barclays argued they followed correct procedures and that no bank error occurred. The ombudsman found that while Barclays should have intervened due to the unusual payment size, any intervention would not have uncovered the sophisticated scam, as the investment appeared legitimate at the time and no public information suggested fraud. The ombudsman also noted that the account received more money than was paid out. The complaint was not upheld.

The Ombudsman's reasoning

While Barclays should have intervened due to the unusual nature of the large payment, the ombudsman found that no further or different intervention would have prevented the payment or uncovered the scam. The investment did not appear fraudulent at the time, and a proportionate enquiry would not have revealed information that would have led to significant doubts. The scam was sophisticated and would not have been discoverable by either Barclays or the customers at that time. Additionally, the account received more money than was paid out, meaning there was no net loss on the Barclays account.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website