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

Decision detail

Summary

Mrs M fell victim to an investment scam and made three international payments totalling £25,900 from a newly opened Metro Bank account. Metro Bank refused to refund the losses, arguing that mandatory reimbursement rules only apply to UK transfers. The ombudsman upheld the complaint in part, finding that Metro Bank should have intervened with probing questions before processing the first payment, as the transaction pattern (new account, large deposit, immediate high-value payment to new payee) was typical of fraud. However, the ombudsman also found Mrs M partially responsible for not conducting adequate independent checks on an investment opportunity promising unrealistic returns. Metro Bank was ordered to refund 50% of the losses plus interest.

The Ombudsman's reasoning

The ombudsman found that although Mrs M authorised the payments, Metro Bank had a duty under the FCA's Consumer Duty to avoid foreseeable harm by detecting and preventing scams. The pattern of a new account, large deposit, and immediate high-value payment to a new international payee was typical of fraud. Metro Bank's generic scam warning was insufficient; it should have intervened with probing questions. Had it done so, it would have discovered multiple red flags (AnyDesk use, unrealistic returns, informal WhatsApp communication, loan-funded deposit) that would likely have broken the scam's spell. However, Mrs M also bore responsibility as a lay person for not conducting adequate independent checks, particularly given the 'too good to be true' returns promised and the FCA's published warning about the firm. Therefore, liability was apportioned 50/50.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website