Not upheld: failure to prevent fraud/scam; inadequate monitoring and intervention on high-risk cryptocurrency payments complaint against Monzo Bank Limited

Decision detail

Summary

Mrs W fell victim to a sophisticated job scam involving a fake company offering remote work with cryptocurrency investment elements. After receiving initial small payments, she was required to make increasingly large payments to a crypto exchange to continue earning higher commissions. She made 13 payments totalling £47,633.86 from her Monzo account between December 2024 and January 2025, with multiple high-value payments in rapid succession. She also made payments from other bank accounts and borrowed money from a friend under false pretences. The ombudsman found that while Monzo failed to implement appropriate fraud interventions on these clearly high-risk cryptocurrency transactions, there was no causation between this failure and Mrs W's loss because she would have continued making payments through alternative accounts, as Bank S also failed to prevent the scam despite Mrs W being under the scammers' control and instructed to be dishonest.

The Ombudsman's reasoning

The ombudsman found that Monzo should have recognised Mrs W was at risk of financial harm and implemented automated and human interventions starting from the first day of payments (23 December 2024). The red flags included: new account with immediate transfers to crypto exchange, rapid succession of high-value payments (£7,050 in 20 minutes, £10,000 in 30 minutes, £6,400 in 3 minutes over three days totalling £23,450), and well-known cryptocurrency investment scam risks. However, the ombudsman concluded that even if Monzo had intervened and blocked payment 3 and subsequent payments, Mrs W would not have been truthful to a fraud agent due to scammer instructions to lie. The agent would likely have become suspicious and blocked the payment, but Mrs W would have continued attempting payments through Bank S, which also missed opportunities to prevent the scam. Therefore, there was no causation between Monzo's failure to intervene and Mrs W's loss, as she would have persisted in making payments through alternative accounts.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website