Monzo Bank Limited · DRN-6189242

Complaint Mr B complains on behalf of C, a limited company of which he is a director, that Monzo Bank Limited didn’t pay a refund after it reported falling victim to a scam. Background The background to this complaint is familiar to both parties, so I don’t propose to set it out in full. What follows is a brief summary of the key events. In late 2023, Mr B fell victim to an investment scam. He had been communicating via WhatsApp with an individual who claimed to be a cryptocurrency trader. This individual told Mr B that he was connected to the financial regulatory authorities in Germany and that Mr B could earn substantial profits through arbitrage trading. In reality, Mr B was not dealing with a legitimate financial professional but with a fraudster. Relying on what he had been told, Mr B agreed to take part in the supposed investment opportunity. Over the following months, he made numerous payments from C’s account with Monzo to other accounts in his name with Company H and Company R. He did so from September 2023 until December 2023. Mr B realised he had been scammed when he was unable to withdraw the profits he believed he had earned. He complained to Monzo, but it declined to pay a refund. Mr B was unhappy with that response and so he referred his complaint to this service. An Investigator reviewed the complaint but didn’t uphold it. Mr B disagreed with that outcome, and the complaint has now been passed to me for a final decision. Findings I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. As a starting point, the legal position is that a firm is generally required to process payments and withdrawals authorised by its customer, in accordance with the Payment Services Regulations 2017 and the firm’s own account terms and conditions. It is accepted that the payments in dispute here were authorised by C. On that basis, C is presumed liable at first instance. However, that is not the end of the matter. Good industry practice requires firms to monitor for account activity that is unusual or out of character and which may suggest an increased risk of fraud. Where such concerns arise, I would expect a firm to take reasonable steps to protect its customer. This may include issuing clear and timely warnings during the payment journey or contacting the customer to understand the circumstances surrounding the transaction. I don’t think Monzo could’ve been expected to have concerns about the outbound payments C was making to the account at Company H. This was Mr B’s long established personal account and C had a lengthy history of making payments to it, including ones of significant value. While one of the payments he made here was higher than those, I think Monzo could reasonably have taken comfort from the fact that he was paying a well-established payee and not considered it necessary to intervene. The payments to Company R should have attracted greater scrutiny, though. This was a new account (albeit one in Mr B’s name) and the payments were fairly sizeable. The first two payments C made were for £15,000 and £30,000 respectively. I don’t think Monzo should’ve processed those payments without first contacting C to understand the circumstances in which they were being made.

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However, it is not enough for me simply to conclude that Monzo should have done more. I must also be satisfied that any failing on Monzo’s part caused C’s loss, and that an appropriate intervention would have prevented further payments. On the evidence, I find it difficult to support that conclusion. I say that because, when Mr B attempted to move funds on from his accounts with Company H and Company R, their attempts to intervene and protect him from fraud weren’t successful. He spoke to an employee of Company H about his attempts to move funds from his account there to an account with a different firm. He said that he was transferring money to his own account and he expressed frustration at receiving so many calls flagging up the possibility of fraud. The employee asked him why he was transferring the money to a different firm and he told them that he was doing so to take advantage of “better rates.” Company R also intervened in connection with the activity on Mr B’s account and he displayed a great deal of frustration with its employees too. He also gave inaccurate answers to its questions by insisting that he wasn’t making an investment, and nobody was advising him on an investment opportunity. It’s difficult to see how, even if Monzo had done more, it would’ve made a difference here. I don’t say any of this to downplay the significance of what has happened. Mr B was clearly the victim of a cynical scam and C has suffered significant losses as a result. I have a great deal of sympathy for him and the position he’s found himself in. However, my role is to look at the actions and inactions of Monzo and, for the reasons I’ve explained, while I accept that it could’ve done more, I’m not persuaded its failure to do so was the effective cause of C’s losses. Final decision For the reasons I’ve explained above, I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask C to accept or reject my decision before 28 April 2026. James Kimmitt Ombudsman

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