Clydesdale Bank Plc · DRN-5919913

The complaint Mrs A, on behalf of F, complains that Clydesdale Bank Plc trading as Virgin Money (“Virgin”) won’t reimburse money she says she lost to fraud. What happened The background to this complaint is well known to all parties, so I won’t repeat it all in detail here. But, in summary, I understand it to be as follows. Mrs A has explained that she had previously been looking for somebody to help her with computer and phone maintenance. She came across somebody who came highly recommended, who I’ll call “K”, through a social networking app and contacted them. Mrs A says she went on to use K’s services for over a year and had been happy with the service that had been provided. But Mrs A has said she then purchased a laptop from “K”, paying £480 from F’s Virgin account on 14 September 2024. She understood the laptop to be new and that it would come with a warranty. But after buying it, she’s said she found the laptop had issues. She contacted K who was unable to fix it and they suggested that Mrs A should return it to the manufacturer. Mrs A contacted the manufacturer, but found there was no warranty, as it had expired and the laptop wasn’t registered in her name. Believing she’d been the victim of a scam, Mrs A contacted Virgin. It looked into her complaint but didn’t uphold it. In summary, it considered what happened to be a civil matter and that F should take it up with K. Virgin did recognise that it could have handled Mrs A’s complaint better and in recognition of this awarded £60 for the distress and inconvenience caused. Unhappy with Virgin’s response, Mrs A brought F’s complaint to this service. One of our Investigators looked into things, but he didn’t think the complaint should be upheld. In summary, our Investigator didn’t agree that the evidence supported that the payment was made in connection with a scam. So, he didn’t think Virgin were liable to refund F. Mrs A disagreed with the Investigator’s findings. In summary, she maintained that F was the victim of an APP scam and that Virgin should refund the money that had been lost. As agreement couldn’t be reached the complaint has been passed to me for a final decision. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. In deciding what’s fair and reasonable in all the circumstances of a complaint, I’m required to take into account relevant: law and regulations; regulators’ rules, guidance and standards; codes of practice; and, where appropriate, what I consider to have been good industry practice at the time.

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Having considered everything, I can see no basis on which I can fairly require Virgin to refund the money Mrs A sent. I can appreciate that this outcome is not the one Mrs A was hoping for and I can understand why she wants to try and recover this money. But having thought about Virgin’s actions, I am unable to say it has a responsibility for refunding the money Mrs A sent. I will explain why. In broad terms, the starting position at law is that a firm is expected to process payments and withdrawals that its customer authorises, in accordance with the Payment Services Regulations and the terms and conditions of the customer’s account. When Virgin made the payment, it was complying with Mrs A’s instructions. At the time, Mrs A wanted to pay K and there was no mistake made as the money was sent to the correct account details. As I don’t think Virgin acted incorrectly by making the payment, I’ve gone on to consider whether it should have refunded F for any other reason. When considering what is fair and reasonable in this case, I’ve also thought about the Lending Standards Board’s voluntary Contingent Reimbursement Model (CRM Code), which was in place at the time the payment was made and that Virgin had signed up to. Under the CRM Code, the starting principle is that a firm should reimburse a customer who is the victim of an APP scam. I’ve thought about whether the CRM code applies in the circumstances of the payment Mrs A made and, in particular, whether Virgin ought to reimburse F under the provisions of the CRM Code. But the CRM Code is quite explicit that it doesn’t apply to all push payments. It says: “DS2(2) This code does not apply to: (b) private civil disputes, such as where a Customer has paid a legitimate supplier for goods, services, or digital content but has not received them, they are defective in some way, or the Customer is otherwise dissatisfied with the supplier” Subsections (a) and (c) have been omitted as they are not relevant to this complaint. Both the bank and our Investigator felt the payment Mrs A made formed part of a buyer/seller dispute and, as such, is not covered by the CRM Code. Mrs A strongly disagrees. She feels the seller has scammed her. From what I have seen, although I accept that Mrs A has said there was some issues with the laptop, I don’t think I can fairly say that the situation F finds itself in is a scam. I think the payment Mrs A made does form part of a civil dispute and, as such, is not covered by the CRM Code. This means I don’t think Virgin is responsible for reimbursing F because of any obligation under the CRM Code. I can appreciate why Mrs A feels aggrieved. She believes that K didn’t sell her a new laptop, that it has some faults and that she is left with a laptop that doesn’t work properly. But I am mindful that Mrs A did receive a laptop for the money she paid. And with the evidence that is available to me, I can’t fairly or reasonably say the seller was not legitimate and had set out to deceive Mrs A. There is no dispute that the laptop exists, as F has taken ownership of it, and I’ve not seen anything that makes me think the person selling it (K) did not have the right to sell it. The problems Mrs A has raised stem back to the condition of the laptop. But this is an issue that’s clearly stated as not being catered for within the CRM Code.

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In the individual circumstances of this case, there are also a number of other factors that aren’t typically seen in scams. I say that as the evidence I’ve seen shows that K did stay in contact with Mrs A, at least for a time, after the disagreement arose. This is not usual in the case of scams, where more often than not, on receipt of a victim’s money, a fraudster will not provide any goods at all and then no longer be contactable. I’m also mindful that it seems K did try to fix the laptop, before suggesting to Mrs A that she contact the manufacturers. The evidence also supports that K didn’t deny that the laptop had initially been registered in their name. As well as this, while I acknowledge that there wasn’t a full year’s warranty – evidence Mrs A has shared indicates that the manufacturer’s warranty ran until April 2025, which suggests it had several months to run on it after it had been bought from K. Furthermore, Mrs A has said that she’d been using K’s services for some time before buying the laptop and had been pleased with the service K had provided. While this doesn’t of course rule out the possibility that K may go on to commit a fraud, I find it more compelling that all of these things support the notion that K was legitimate and wasn’t setting out with the intent to defraud. I understand that Mrs A reported the matter to the Action Fraud. But I’ve seen that it has said based on the information available, it has not been possible to identify a line of enquiry which a law enforcement organisation in the United Kingdom could pursue. While I’m mindful it isn’t necessary for a criminal conviction to have been secured or for charges to have been brought for what happened here to meet the CRM code definition of a scam - the fact that the relevant authorities appear not to be pursuing a substantive investigation into the allegations raised by Mrs A suggests to me that the evidence presented does not, on its own, carry sufficient weight to support a finding of fraud. I’m mindful that Mrs A has referred to her rights under Consumer Rights Act 2015 (CRA 2015). However, the CRA 2015 implies terms with the seller of the laptop, K. If the laptop had been bought on credit, then Mrs A may have had some protection via the lender. But in the individual circumstances of this case, Virgin has no obligations in respect of any potential breach of contract by the seller. Should Mrs A wish to pursue a claim, under CRA 2015 considerations, this would have to be against K, rather than Virgin. I note that Virgin paid compensation of £60 for poor service. Virgin acknowledged the level of service fell short and I’m satisfied it awarded an appropriate amount of compensation to reflect what happened. The amount of compensation it paid is in line with what I would have recommended, so I won’t be asking it to pay anymore. Overall and on balance, based on what I’ve seen. I’m not persuaded that this situation displays the hallmarks most typically associated with a scam. It follows that, I can’t safely say that this would likely meet the high legal threshold and burden of proof for fraud. This is not to say that there is no issue at all between F and the seller. Clearly there is. But this type of dispute isn’t something that the CRM Code covers. So, I don’t think it was unfair for Virgin to take the view that it wasn’t responsible for refunding F under the CRM Code. My final decision My final decision is that I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask F to accept or reject my decision before 21 April 2026. Stephen Wise Ombudsman

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