Not upheld: Fraud reimbursement (APP scams) complaint against Lloyds Bank PLC

Decision detail

Summary

Mrs X complained that Lloyds Bank PLC should have refunded £3,600 she transferred to a third-party EMI account after falling victim to a task-based scam in December 2025. She was groomed by scammers who initially paid her small amounts before instructing her to transfer increasingly larger sums. Lloyds declined to reimburse, citing that the mandatory reimbursement rules do not apply to payments made to accounts held in the person's name. The Ombudsman upheld Lloyds' position, finding the payments were not sufficiently unusual to require intervention and that Mrs X likely would have continued with the payments despite warnings, as evidenced by her ignoring fraud interventions from the receiving EMI.

The Ombudsman's reasoning

The Ombudsman considered whether Lloyds ought reasonably to have identified the payments as sufficiently unusual or suspicious to require intervention. While acknowledging Mrs X was victim of a sophisticated scam involving grooming and manipulation, the Ombudsman found the payments were not sufficiently unusual given they were spread over 2-3 days, were broadly similar to her normal account activity, and the account reduction was not itself unusual. Additionally, evidence showed the third-party EMI provided fraud warnings which Mrs X ignored, suggesting any Lloyds intervention would likely not have prevented the loss.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website