Upheld: failure to intervene in authorised push payment (APP) scam; inadequate fraud detection and customer warnings complaint against Wise Payments Limited

Decision detail

Summary

Mr A was scammed by a fake investment platform and made four payments totalling £20,429 through Wise between 3-23 September 2025. The platform was subject to an FCA warning since July 2025. Wise failed to intervene on the second payment (£9,961) despite clear risk factors including significant amount, newly opened account, and escalation from the first payment. The ombudsman found that appropriate intervention with tailored warnings and follow-up questions would likely have prompted Mr A to research the platform and discover the FCA warning and negative reviews, preventing further losses. While Mr A bears 50% responsibility for not researching despite obvious warning signs (unrealistic returns, being asked to borrow), Wise bears 50% responsibility for failing to intervene. Wise must refund 50% of payments 2-4 (£9,965) plus 8% interest.

The Ombudsman's reasoning

Wise had an obligation to process authorised payments but also a duty to look out for APP scams and intervene proportionately when clear risk indicators were present. The second payment of £9,961 presented sufficient risk factors: it was a significant amount, the account was newly opened (two days prior), the payee was an account in Mr A's own name with another EMI, and there was sudden escalation in payment value. Wise should have sent a tailored written warning asking about payment purpose and follow-up questions. If Mr A had answered honestly about investing, Wise should have warned him to research and check the FCA website. The ombudsman found it likely Mr A would have heeded such warnings from his financial service provider (the expert) and would have discovered the FCA warning and negative reviews, preventing further losses. Mr A bears 50% responsibility due to failure to research despite obvious warning signs (unrealistic returns, being asked to borrow to invest), but Wise bears 50% responsibility for failing to intervene on the second payment.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website