Nationwide Building Society · DRN-6181446

The complaint Mr and Mrs L complain that Nationwide Building Society (‘Nationwide’) won’t reimburse the funds they lost when they say they fell victim to a scam. What happened Mr and Mrs L have a joint account with Nationwide from which the payments in this case were made. Mr and Mrs L bought a new kitchen from a known supplier. The salesman suggested that getting the kitchen fitted through the company would be more expensive and recommended a builder to install it. I’ll call this builder ‘C’ in my decision. C visited Mr and Mrs L and provided a quote for the work, which they accepted. Mr and Mrs L were asked to pay a deposit, which they paid in March 2025. Some additional work was also agreed. Work started at Mr and Mrs L’s property but over time the pace of the work slowed, and they became concerned about the quality of it. They raised their concerns with C, who said he would return to the property to put things right. This didn’t happen and Mr and Mrs L say they were left with incomplete work. They have subsequently paid other tradespeople to put right C’s mistakes and complete the work, meaning that in addition to £13,309.39 paid to C they have paid over £10,000 to put things right. Mr and Mrs L have explained the impact of C’s failures on them. The funds used came from an inheritance and Mr L suffered serious ill health shortly before the building work began. They have both suffered a lot of stress and anxiety. In July 2025 Mr and Mrs L raised a fraud claim with Nationwide. Nationwide said Mr and Mrs L have a civil dispute with C and it isn’t responsible for their loss. Mr and Mrs L were unhappy with Nationwide’s response and brought a complaint to this service. The investigator who considered their complaint didn’t recommend that it be upheld. She said she wasn’t persuaded C didn’t intend to complete the agreed works. Mr and Mrs L didn’t agree with the investigator’s findings and asked for a final decision. They say their funds were obtained by misrepresentation with no genuine intention or ability to fulfil contractual obligations. There are also other victims, one of whom has been reimbursed by another bank, and a police investigation is ongoing. 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 be good industry practice at the time. Where evidence is unclear or in dispute, I reach my findings on the balance of probabilities – in other words on what I consider most likely to have happened based on the evidence available and the surrounding circumstances.

-- 1 of 3 --

I understand Mr and Mrs L have strong views about what has happened and believe C preyed on their vulnerability. I want to assure them that I’ve considered everything they have provided to support the complaint very carefully. I appreciate Mr and Mrs L say that C was recommended to them by the kitchen supplier they bought their new kitchen from. I have no powers to consider a complaint against the supplier, and neither can I consider a complaint against C. My role is to consider whether Nationwide treated Mr and Mrs L fairly. In broad terms, the starting position at law is that a bank is expected to process payments and withdrawals that a customer authorises it to make, in accordance with the Payment Services Regulations (in this case the 2017 regulations) and the terms and conditions of the customer’s account. The Financial Services and Markets Act 2023 required the Payment Systems Regulator (PSR) to introduce a reimbursement requirement for payments made over the Faster Payments Scheme as a result of fraud or dishonesty. Consequently in 2024, the PSR required the Faster Payments scheme operator (PayUK) to change the Faster Payment Rules to require the firms that operate over Faster Payments to reimburse their customers sums paid as a result of APP (authorised push payment) scams in certain circumstances. These Rules, which I’ll call the Reimbursement Rules, came into force on 7 October 2024. In this case, I’ve first considered whether the Reimbursement Rules and associated guidance issued by the PSR are relevant to the payments Mr and Mrs L made to C. Where they are relevant, I must have regard to the rules and guidance, as well as considering what is fair and reasonable in all the circumstances of the complaint. The Reimbursement Rules set out the requirements for a payment to be covered and sets out the features and definition of an APP scam. The Rules specifically define an APP scam as: “Where a person uses a fraudulent or dishonest act or course of conduct to manipulate, deceive or persuade a Consumer into transferring funds from the Consumer’s Relevant account to a Relevant account not controlled by the Consumer, where: • The recipient is not who the Consumer intended to pay, or • The payment is not for the purpose the Consumer intended”. And the Rules specifically outline that private civil disputes are not covered. The term private civil dispute is defined in the Rules as: “A dispute between a Consumer and payee which is a private matter between them for resolution in the civil courts, rather than involving criminal fraud or dishonesty.” In its published policy statement PS23/3, the Payment Systems Regulator gave further guidance: “2.6 Civil disputes do not meet our definition of an APP fraud as the customer has not been deceived […] The law protects consumer rights when purchasing goods and services, including through the Consumer Rights Act.” 2.5 provides an example of when this might apply and says: “…such as where a customer has paid a legitimate supplier for goods or services but has not received them, they are defective in some way, or the customer is otherwise dissatisfied with the supplier.” Mr and Mrs L paid the person they intended to pay. So, for Mr and Mrs L to be the victims of an APP scam as defined, I would need to be satisfied that C was acting fraudulently and dishonestly to deceive Mr and Mrs L about the very purpose for which their payments had been requested.

-- 2 of 3 --

Here, the purpose of the payments was to complete building works that were set out in an email from C to Mr and Mrs L in March 2025. Mr and Mrs L’s purpose was to have the work carried out and C’s purpose was to complete that work – so their purposes are aligned. It is clear from the evidence provided that C and others attended Mr and Mrs L’s property on a consistent basis between 2 May and mid to late June 2025, and that during this time a fair amount of work was completed. The pictures Mr and Mrs L have provided also show that work was in progress. Whilst Mr and Mrs L haven’t provided all messages exchanged with C, I’ve seen some messages where Mrs L expresses satisfaction with what has been done. And the letter Mr and Mrs L have provided from another kitchen fitter sets out that kitchen units had been installed and plumbing work carried out – albeit to a poor standard. I appreciate that work wasn’t completed and that the quality of that work was inadequate. It seems to me that’s it’s just as likely work wasn’t completed because of a breakdown in the relationship between Mr and Mrs L and C, and a loss of trust on both sides. I can see that Mr and Mrs L, on the advice of the kitchen company manager, asked C not to attend their property and later asked him to return to complete the work. I understand that C expressed concerns about coming back and a date wasn’t agreed. And, as I have said above, poor quality work isn’t covered by the Reimbursement Rules. While some of the issues Mr and Mrs L have highlighted might suggest C wasn’t acting as I might expect a professional builder to do, acting unprofessionally does not mean someone intendeds to operate a scam. And the fact there were previous county court judgements against C doesn’t prove he never intended to complete the work he agreed with Mr and Mrs L. I have considered that there is an ongoing police investigation. The latest update from the police is that C has been arrested on suspicion of fraud, interviewed under caution and released on bail. The police say that further enquiries need to be made before a charging decision can be made. The fact the police arrested C shows they have concerns, but this isn’t enough to conclude the APP scam definition I have referred to above has been met. Whilst another bank may have chosen to reimburse one of its customers that also paid C, that doesn’t mean I can require Nationwide to reimburse Mr and Mrs L. As Nationwide didn’t need to consider this as an APP scam, it didn’t need to go on to contact the recipient account provider or apply any other considerations under the Reimbursement Rules. And, Nationwide doesn’t have any duty or obligation to intervene in payments that are legitimate or to protect its customers from the impact of a bad deal. I’m not saying Mr and Mrs L don’t have a legitimate grievance against C. But I can only look at Nationwide’s responsibilities here. Overall, I don’t think Nationwide has treated Mr and Mrs L unfairly when it made the decision not to reimburse them. Overall, whilst I’m very sorry to hear about the circumstances of this complaint and the impact C’s actions have had on Mr and Mrs L, I can’t fairly require Nationwide to reimburse them. My final decision For the reasons stated, I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr L and Mrs L to accept or reject my decision before 16 April 2026. Jay Hadfield Ombudsman

-- 3 of 3 --