Not upheld: Fraud reimbursement (APP scams) complaint against Santander UK Plc

Decision detail

Summary

Mrs P complained that Santander lent her £15,000 without her knowledge or consent after she was targeted by a cryptocurrency investment scam. The scammer used remote access software to control her device and facilitate the loan application and fund transfers. Santander rejected her claim, and Mrs P complained to the FOS arguing Santander failed to conduct proper checks or detect unusual activity. The ombudsman found that Mrs P participated in the loan application based on technical security measures (facial recognition and correct verification code input) and that Santander's affordability checks were adequate. Although the transfer was a high-value transaction, Santander was not obliged to intervene on transfers to established payees in the customer's own name, and Mrs P's misleading responses to Bank H's fraud interventions would have prevented scam detection. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman concluded that Mrs P participated in the loan application because it was completed using her genuine details, the verification code sent to her home address was correctly inputted after facial recognition login, and it is not technically possible for a third party to control an Apple device. Regarding affordability, Santander's assessment based on stated income of £2,300 and expenditure of £450 was reasonable, and it was not expected to independently verify financial information. Regarding fraud prevention, while the high-value transfer following loan receipt might have raised concerns, Santander was not obliged to intervene when funds were being transferred to an established payee in Mrs P's own name. Even if Santander had intervened, Mrs P's responses to Bank H's interventions (denying she had been coached or downloaded remote access software) would have prevented detection of the scam, and she ignored warnings about investment scams.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website