Not upheld: Fraud reimbursement (APP scams) complaint against Nationwide Building Society

Decision detail

Summary

Mr B complained that Nationwide failed to refund over £130,000 lost to investment and recovery scams in August-September 2023. Mr B had previously fallen victim to an almost identical recovery scam in late 2022, had received warnings from both Nationwide and FOS, yet continued to make payments to the scammer. The ombudsman found that while Nationwide should have intervened more, no intervention would have prevented the loss given Mr B's vulnerability and demonstrated willingness to use alternative means when payments were blocked. The complaint was not upheld as Nationwide had no obligation to refund under the Contingent Reimbursement Model and chargebacks were not viable.

The Ombudsman's reasoning

While Nationwide should have intervened more and asked more questions, the ombudsman concluded that no intervention would have prevented the scam because Mr B was sufficiently under the spell of the scammers. Mr B had prior experience with an identical recovery scam, had received warnings from Nationwide and FOS, yet continued to make payments. When other providers stopped payments, he used alternative means, demonstrating that even if Nationwide had prevented payments, he would have found other ways to send funds. Additionally, Nationwide had no obligation to refund under the Contingent Reimbursement Model as funds were sent to an account in Mr B's own name, and chargebacks would not have worked as the payments were authorised transfers to crypto exchanges.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website