Not upheld: Account closure without notice complaint against Hampshire Trust Bank Plc (trading as HTB)

Decision detail

Summary

Mr and Mrs C complained that Hampshire Trust Bank Plc unfairly reported them to Cifas (a fraud prevention database) in connection with a declined 2024 mortgage refinancing application. HTB had reported them after discovering that altered bank statements submitted with their application had been falsified to misrepresent their financial position. Mr and Mrs C claimed a workplace administrator had altered and submitted the documents without their knowledge to sabotage their property business. The ombudsman found HTB was initially justified in making the Cifas report based on the submission of falsified statements from their accounts. However, the ombudsman also assessed whether the markers should now be removed based on Mr and Mrs C's explanation and found significant inconsistencies in their account, including why they would continue trusting an administrator with documented disciplinary problems and why that person would improve rather than worsen their financial statements if attempting sabotage. The complaint was not upheld and the markers were not required to be removed.

The Ombudsman's reasoning

The ombudsman applied Cifas principles requiring clear, relevant and rigorous evidence to support a reasonable suspicion of fraud. While HTB was initially justified in reporting the markers based on the submission of falsified bank statements from Mr and Mrs C's accounts, the ombudsman found inconsistencies in Mr and Mrs C's explanation that undermined their credibility. The ombudsman noted that despite the administrator's documented disciplinary problems (including impersonating Mrs C), it was unclear why Mrs C would continue trusting them with full financial access. Additionally, if the administrator's motive was sabotage, it was illogical they would alter statements to improve the financial position and increase chances of mortgage approval. The ombudsman concluded there remained reasonable grounds to suspect Mr and Mrs C's involvement in submitting the altered statements.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website