Not upheld: Service failures generally complaint against Lloyds Bank PLC

Decision detail

Summary

Mr S complained that Lloyds Bank PLC failed to prevent him from making approximately £23,000 in payments to an investment scam between April 2024 and March 2025. Lloyds rejected the complaint, and the FOS Investigator upheld that decision. The ombudsman affirmed this outcome, finding that the individual payment amounts did not trigger automatic checking thresholds and that Lloyds had intervened proportionately on multiple occasions. Although Mr S provided false information during these interventions, the ombudsman concluded that further questioning would likely not have changed his behaviour, and that chargebacks would not have been successful since Mr S received the crypto he paid for. The complaint was not upheld and no remedy was ordered.

The Ombudsman's reasoning

The ombudsman applied the Payment Services Regulations 2017, which establish that consumers are generally liable for authorised payments while firms have obligations to protect customers from fraud. The ombudsman found that the individual payment amounts, spread over 11 months, did not reach a threshold that should have triggered automatic checking processes. Although Lloyds intervened proportionately on numerous occasions, the information Mr S provided was convincing and false, and the ombudsman was not persuaded that further questioning would have changed Mr S's behaviour given his confidence in the legitimacy of the investment. The ombudsman also rejected the suggestion that Lloyds should have called police or attempted chargebacks, as these would not have been proportionate or successful given that Mr S received the crypto he paid for.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website