Partially upheld: Fraud reimbursement (APP scams) complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr G fell victim to an employment scam after receiving unsolicited WhatsApp contact, making 15 payments totalling £12,484 to his own cryptocurrency account between 17-24 April 2025, which were then sent to scammers. He realised the scam when asked to pay a large tax bill. Barclays did not intervene or reimburse the funds. The ombudsman found Barclays should have intervened at payment 7 (the fourth payment on the same day to a cryptocurrency provider) based on fraud risk indicators and regulatory duties to monitor accounts and prevent fraud. However, Mr G also bore responsibility by ignoring his own expressed concerns and multiple red flags without conducting independent investigation, warranting equal (50/50) responsibility. After deducting credit card provider write-offs of £8,324.80 and proportionate 'income' credits of £102, the outstanding loss was £2,139. Barclays must reimburse 50% (£1,069.50) plus £125 compensation for customer service failures. No interest awarded as the funds were borrowed.

The Ombudsman's reasoning

Barclays had contractual and regulatory duties to monitor accounts for fraud and take additional steps where appropriate. While customers are generally responsible for authorised payments, banks must conduct business with due skill and care and maintain effective fraud prevention systems. The initial payments were not unusual enough to warrant intervention. However, by payment 7, multiple risk factors were present: it was the fourth payment on the same day, to a cryptocurrency provider, with cumulative high value. Cryptocurrency payments pose increased fraud risk. Barclays should have intervened at payment 7 and made enquiries. Had it provided a tailored warning about job scams, Mr G would likely have recognised the red flags given his own expressed concerns. However, Mr G also bore responsibility: he received unsolicited contact via WhatsApp (unprofessional), expressed early concerns about legitimacy, received payments from personal accounts (unprofessional), was offered unrealistic earnings, and was asked to make payments to earn money via cryptocurrency (unusual). Despite these red flags, he proceeded without independent investigation. His vulnerability due to mental health issues did not impair his ability to identify these warning signs, as evidenced by his own expressed concerns. Therefore, equal responsibility (50/50) is fair. Credit card providers' write-offs of £8,324.80 should be deducted from Mr G's loss as they relate to payments 7 onwards. No interest is awarded as Mr G was not personally out of pocket (borrowed funds). Customer service failures warrant £125 additional compensation beyond the £625 already paid.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website