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

Decision detail

Summary

Mr P paid £10,830 to Mr Y for window repair and refurbishment work in two instalments. After commencing work for approximately one month, Mr Y ceased attendance citing medical appointments, family issues, and health problems, leaving the windows in a stripped state. Mr P reported the matter to Starling as a scam, but Starling classified it as a civil dispute. The ombudsman upheld Starling's decision, finding insufficient evidence that Mr Y intended to defraud Mr P at the time of payment. Although Mr Y failed to complete the work, the ombudsman found his explanations plausible, his behaviour inconsistent with typical fraud, and the recipient bank had no scam concerns. The ombudsman concluded this was a contractual dispute outside the scope of the Reimbursement Rules.

The Ombudsman's reasoning

The ombudsman applied the Reimbursement Rules definition of an APP scam, which requires clear and unambiguous evidence that the recipient had no intention of providing the goods or services at the time of payment. The ombudsman found that Mr Y did commence work, provided plausible explanations for delays (medical and family issues), continued professional communication, did not request further payments, and the recipient bank had no scam concerns. While the work was not completed, non-completion alone does not prove fraudulent intent at the time of payment. The ombudsman concluded this was a civil dispute regarding breach of contract or poor service delivery, which is explicitly excluded from the Reimbursement Rules.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website