Not upheld: Fraud reimbursement (APP scams) complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr G complained that Barclays refused to reimburse approximately £9,000 he paid to B, a music industry contact who promised to help secure a record deal but delivered no results. Barclays declined the scam claim, treating it as a civil dispute. The ombudsman upheld Barclays' decision, finding that while Mr G received nothing in return, the evidence did not establish fraud on the balance of probabilities. B had a legitimate presence in the music industry, had issued a formal consultancy agreement, and had no suspicious account activity, suggesting a failed business arrangement rather than an intentional scam. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman applied the CRM Code definition of an APP scam, which requires that funds were transferred for what the customer believed were legitimate purposes but which were in fact fraudulent. To find fraud, convincing evidence was needed showing fraud was the most likely explanation on the balance of probabilities. The ombudsman found that B had a legitimate presence in the music industry prior to dealing with Mr G, had issued a formal consultancy agreement, and had no adverse information or suspicious account activity associated with them. The failure to deliver results, while disappointing, was insufficient to establish fraud as the most likely explanation, as it could equally be explained as a failed business arrangement.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website