HSBC UK Bank Plc · DRN-6047329

The complaint Ms R complains HSBC UK Bank Plc (“HSBC”) hasn’t refunded funds she lost as the result of a scam. What happened Both parties are familiar with the circumstances of the complaint, so I’ll only summarise the key details here. Between June and August 2025 Ms R made several payments to what she thought was a legitimate cryptocurrency investment. Ms R was able to make an initial withdrawal, but when she requested to withdraw further funds the scammer stopped communicating with her. This is when she realised she’d been scammed. Ms R contacted HSBC in September 2025, but it didn’t refund her. Unhappy with HSBC’s response, Ms R raised the matter with the Financial Ombudsman Service. One of our Investigators looked into the complaint and didn’t uphold it. They thought HSBC’s interventions were proportionate to the risk the payments presented and Ms R wasn’t honest in her answers. They thought even if HSBC had intervened further the scam wouldn’t have been uncovered due to the coaching Ms R was receiving from the scammer. As an agreement could not 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. I’m sorry that Ms R has been the victim of a scam. I realise she’s lost a significant sum of money, and I don’t underestimate the impact this has had on her at an already difficult time. And so, I’d like to reassure her that I’ve read and considered everything she’s said in support of her complaint. But I’ll focus my comments on what I think is relevant. If I don’t mention any specific point, it’s not because I’ve failed to take it on board and think about it, but because I don’t think I need to comment on it to reach what I think is a fair and reasonable outcome. I know this will come as a disappointment to Ms R but having done so, I won’t be upholding her complaint. I’ll explain why. In broad terms, the starting position at law is that banks and other payment service providers are expected to process payments and withdrawals that a customer authorises it to make, in accordance with the Payment Services Regulations and the terms and conditions of the customer’s account. Ms R authorised the payments in question here – so even though she was tricked into doing so and didn’t intend for her money to end up in the hands of a scammer, she is presumed liable in the first instance.

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But as a matter of good industry practice, HSBC should also have taken proactive steps to identify and help prevent transactions – particularly unusual or uncharacteristic transactions – that could involve fraud or be the result of a scam. However, there is a balance to be struck: as while banks should be alert to fraud and scams to act in their customers’ best interests, they can’t reasonably be involved in every transaction. I’ve also thought about the Contingent Reimbursement Model which HSBC is a voluntary signatory of and the Authorised Push Payment Reimbursement Rules. Neither cover payments made to an account in a customer’s name or card payments, and so aren’t relevant here. I’ve thought about whether HSBC acted fairly and reasonably in its dealings with Ms R when she made the payments, or whether it should have done more than it did. Ms R made several payments from her HSBC account towards the scam. HSBC intervened prior to processing some of the payments and spoke with Ms R by phone. I think HSBC should have intervened sooner than it did but having considered things I’m not persuaded that any intervention from HSBC would have uncovered the scam and prevented her losses. I’ll explain why. I should explain that for me to find it fair and reasonable that HSBC should refund Ms R requires more than a finding that it ought to have intervened further than it did. I would need to find not only that HSBC failed to proportionately intervene where it ought reasonably to have done so – but crucially I’d need to find that but for this failure the subsequent loss would’ve been avoided. That latter element concerns causation. A proportionate intervention will not always result in the prevention of a transaction. And if I find it more likely than not that such a proportionate intervention by HSBC wouldn’t have revealed the transactions were part of a fraud or scam, then I couldn’t fairly hold HSBC liable for not having prevented them from being made. I’ve listened to calls HSBC had with Ms R, and she wasn’t entirely fourth coming with the reason for the payments. At no point did she tell HSBC that she was investing her funds. And the payments being made to money transfer services wouldn’t have suggested to HSBC that the true reason for the payments was as part of an investment, it therefore could only have known this if Ms R had told it. This meant Ms R didn’t get meaningful investment scam warnings or education. A firm’s intervention relies on a customer being honest, and when that doesn’t happen, as is the case here, it can impact the actions a firm takes. Additionally, the communications between Ms R and the scammer show she was actively coached while speaking with HSBC. Ms R informed the scammer she’d be speaking with HSBC prior to the calls and before the first intervention call the scammer told Ms R to let him know if she needed any help and that if they asked how long she’d had her account with the beneficiary to say for a few years. In summary, during a call when asked Ms R said she was moving funds to a money transfer service to take advantage of a better exchange rate and then would be moving the funds to a European account in her name. During the call HSBC asked how she got the receiving account details, and Ms R asked the scammer this question and repeated their answer to HSBC. The scammer also told Ms R to tell HSBC she’d be making future payments and not to bother her each time. Ms R told HSBC she’d be making more payments, and it informed her all payments are subject to checks. During one call Ms R said she was making the payment for a better interest rate, given the destination of the payment this wasn’t plausible, so I’d have expected HSBC to probe her on this. I can’t be sure what would have happened if it had, however on balance, I think that she would have been able to satisfy HSBC had it done so. I think she would have more likely

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than not told HSBC her European account was the end destination with the higher rate of interest, not the money transfer service, and that the payments were being made via the beneficiary for a better exchange rate as she explained in the call outlined above. This was also the reason Ms R gave during another call with HSBC when she said the reason for the payment was for a higher rate of interest in her global account via the money transfer service. When asked how long she’d held an account with the money transfer service Ms R followed the scammer’s guidance and said it was for a few years. HSBC probed Ms R on this and asked why she’d not made payments via HSBC to the account before July, in summary she said she’d only just started to use HSBC for these types of transactions. HSBC also questioned Ms R on the credits that entered her account prior to the payments being made and she explained she’d moved funds from another of her accounts as she found the banking app wasn’t reliable, she found it would be under development and wasn’t suitable. Given the use of multi-stage fraud by scammers whereby a customer moves funds through more than one account under their control before being sent to a fraudster, I think HSBC was right to question this and I think Ms R’s answers were plausible. The communications also show Ms R was coached through an interaction with one of the money transfer services and when it asked for evidence prior to processing a transaction, the scammer advised her to cancel the payment which Ms R confirmed she did. The communications between the scammer and Ms R show the degree to which she was under their spell and truly believed the investment was legitimate and was making her a good profit. I think on balance, had HSBC intervened further she would more likely than not have behaved in a similar way and not disclosed the payments were part of an investment and if needed approached the scammer for guidance. As I don’t think HSBC could have reasonably prevented Ms R from making the payments, it wouldn’t be fair or reasonable to hold it liable for her losses. Given the time between the payments being made and the scam being reported to HSBC, I don’t think there was any prospect of recovering Ms R’s funds. I’m sorry to disappoint Ms R further, but I’ve thought carefully about everything that has happened, and with all the circumstances of this complaint in mind I don’t think HSBC needs to refund her money. I realise this means Ms R is out of pocket and I’m really sorry she’s lost this money. However, for the reasons I’ve explained, I don’t think I can fairly or reasonably uphold this complaint. My final decision My final decision is that I do not uphold this complaint against HSBC UK Bank Plc. Under the rules of the Financial Ombudsman Service, I’m required to ask Ms R to accept or reject my decision before 28 April 2026. Charlotte Mulvihill Ombudsman

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