Not upheld: Fraud reimbursement (APP scams) complaint against Monzo Bank Limited

Decision detail

Summary

Mrs A paid £3,250.59 to a travel agency (B) for flights between April and October 2025. In December 2025, B announced financial difficulties, went into liquidation, and Mrs A did not receive her flight tickets. Mrs A claimed this was an Authorised Push Payment (APP) scam and requested reimbursement from Monzo Bank Limited, which declined on the basis that it was a civil dispute rather than a scam. The ombudsman upheld Monzo's decision, finding that while B failed to provide services, the available evidence did not demonstrate that B intended to defraud Mrs A from the outset. Although B's director was arrested on fraud allegations, no charges have been brought, and the bank statements and business history did not show clear indicators of fraudulent intent, distinguishing this from a scam and placing it in the category of business failure.

The Ombudsman's reasoning

The ombudsman applied the legal definition of an APP scam under the Reimbursement Rules, which requires either that the recipient was not who the consumer intended to pay, or that the payment was not for the purpose intended. Mrs A paid the company she intended to pay, so the first element did not apply. For the second element, the ombudsman would need convincing evidence that fraud was the most likely explanation for non-provision of services, rather than other possibilities such as business failure. While B's director was arrested on fraud allegations and media reports alleged fraudulent conduct, no charges have been brought and the ombudsman had insufficient evidence to conclude that B set out with intent to defraud from the outset. The bank statements did not show common hallmarks of fraud, and B operated as a legitimate business for years with positive reviews. Continuing to accept payments while insolvent could indicate negligence rather than dishonesty, which would be a civil matter rather than fraud.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website