Nationwide Building Society · DRN-6183083

The complaint Mrs G complains that Nationwide Building Society unfairly refuses to refund money she lost in an impersonation scam. What happened On 8 December 2024, Mrs G tried to book airline tickets for four family members. She says she searched online for the telephone number of a particular travel agent she wanted to use and she called the number she found. She spoke to someone she thought was a travel agent and they told Mrs G they had arranged tickets for her. Mrs G explains she thought she was paying around £1,335 per person for the tickets. She says she tried to make a payment with her debit card but she was told it had been declined and was asked to try again. She made two further card payment attempts, one with her Nationwide card and one with a debit card issued by her bank. She was told her e-tickets would follow but Mrs G became suspicious and called Nationwide. She told Nationwide she did not really know what had happened, but she started to think something was wrong. That’s because the amounts of the payments were not what she was expecting to pay and the name of the company she was paying was different to the travel agent she thought she was dealing with. Nationwide raised chargeback claims for the two payments Mrs G made with her debit card, but the claims were defended by the merchant. Mrs G did not receive any tickets, and no money was ever recovered. Mrs G made the following payments as part of this scam. Date Amount Payment type Destination 08/12/2024 £2,493.54 Card payment Overseas travel agent 08/12/2024 £3,202.78 Card payment Overseas travel agent Mrs G says the payments were authorised by her, but she made the payments by mistake, thinking she was paying someone else. She considers Nationwide did not do enough to protect her from fraud. She considers Nationwide should have been able to cancel the payment while it was still pending in her account. She also questions why her bank was able to recover the payment she made but Nationwide has not been successful. Nationwide does not consider it is at fault. It says the payments were authorised. It says it sent Mrs G messages through her banking application, asking her to confirm she was making the payments. These messages contained the merchant’s name and the amount of each payment. Mrs G confirmed the payments were genuine. It tried to recover Mrs G’s money, raising chargeback claims and appeals, but these were defended by the merchant, with evidence, showing that it had provided genuine goods and services, although not to Mrs G. Our Investigator did not recommend that Mrs G’s complaint should be upheld. He said Nationwide ought to have recognised that the second transaction carried a heightened risk

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that it might be a scam because the transactions were made in quick succession, the transactions had a combined value of over £5,000 and were going to a merchant based overseas. He thought Nationwide ought to have sent Mrs G an automated warning that asked her the reason she was making the payment and then further questions designed to narrow-down the scam risk, providing warnings tailored to Mrs G’s answers to those questions. However, the Investigator did not think it was likely that such a warning would have uncovered the scam. He thought Nationwide would have asked questions that would have established that Mrs G was trying to make a purchase, and it would have asked a series of follow-up questions based on that. These questions might have included whether she had been contacted unexpectedly, whether the purchase price appeared too good to be true, perhaps warning about the need to carry out research, or similar. The Investigator did not think these warnings would have resonated with Mrs G because she was expecting to pay over £5,000 for the tickets, she had not been contacted unexpectedly and because she was making the purchase urgently, he did not think Mrs G would have carried out further research. He considered Nationwide had made reasonable attempts to recover Mrs G’s money, raising chargeback requests and appeals when those claims were initially declined. Mrs G did not accept the Investigator’s conclusions. She said while she approved the payments, she did so in the belief she was paying a different company. She says she was under significant distress at the time due to the illness of a family member, and she did not realise she was dealing with a different company. As soon as she made the payments, she contacted Nationwide to cancel them. She was assured by Nationwide that the travel agent was a legitimate company and Nationwide suggested that she wait to see if the tickets came through. She was then told the payment could not be stopped. She raised a similar claim with her bank about a related payment and she received a refund. She does not understand how the same evidence was accepted by her bank and led to a refund, but Nationwide was unable to recover her money. She thinks Nationwide should have the ability to block or cancel a pending transaction and should verify its customers to ensure its customers are protected. 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 was very sorry to read about the circumstances surrounding this scam, in which Mrs G came to lose money to scammers. It seems she has been the victim of a very cruel and quite sophisticated scam, which I have no doubt has caused a great deal of distress as well as financial loss. This came at a time when Mrs G was dealing with a family illness. I also want to pass on my sincere condolences to Mrs G, following the recent death of her husband. But despite my natural sympathy, having considered all the information and evidence that has been provided to me, I am not persuaded I can reasonably uphold her complaint. In broad terms, the starting position 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. And in this case, it’s accepted by all parties that Mrs G authorised the payments and Nationwide made the payments in accordance with Mrs G’s instructions, although Mrs G says she was tricked into authorising the payments. The APP scam reimbursement (ASR) rules do not apply in this case because they do not

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apply to debit card payments. But the matter does not end there. Having taken into account longstanding regulatory expectations and requirements, and what I consider to be good industry practice, I think Nationwide ought to have been on the look-out for the possibility of fraud and made additional checks before processing payments in some circumstances. I agree with the Investigator that two payments to an overseas travel agent, with a total value of over £5,000 were sufficiently unusual transactions for Mrs G’s account which ought reasonably to have prompted intervention from Nationwide on the second transaction. I also agree that a better written warning would have been an appropriate form of intervention in the circumstances. I do not consider the circumstances were such that stronger intervention would have been warranted. Such a warning would have involved attempting to narrow down the particular scam risk by asking questions and then providing tailored warnings based on Mrs G’s answers. Like the Investigator, I am not persuaded such intervention is likely to have led to the scam being uncovered. If Nationwide had intervened in the way described, it’s likely it would have asked Mrs G the reason for the payment and she would have likely told it she was making a purchase. Reasonable follow-up questions might have included whether she had been contacted unexpectedly and asked to make a payment, whether she knew the payee, whether she had carried out any research before making the purchase, whether the price seemed too good to be true. Mrs G had not been contacted unexpectedly and asked to make a payment, she had searched for the telephone number of a particular travel agent she knew was legitimate and she thought she was dealing with them. Questions and warnings about unexpected contact, research and knowing who she was dealing with are therefore unlikely to have resonated with her, in my view. She was also trying to buy tickets urgently, so it seems unlikely she would have carried out further research due to time constraints. The amount she was being charged was also broadly what she was expecting to pay, albeit over two payments. In short, the answers she is likely to have given are unlikely to have caused concern to Nationwide and the warnings she might have received from Nationwide are unlikely to have resonated with her. These were payments Mrs G was expecting to make. Nationwide did send messages to Mrs G about both payments, through the banking application, setting out who she was paying, asking her to confirm that it was her making the payments and asking her to approve the payments. She approved both payments despite the name of the payee being different to the one she was expecting to pay. In my view, that was the piece of information most likely to have drawn her attention, because she thought she was paying a specific travel agent she had sought out, rather than the company shown in Nationwide’s message. But that discrepancy doesn’t seem to have registered with her before making the payment. I understand that Mrs G was dealing with a family emergency, she was in a hurry, and she was distressed before she even spoke to a scammer, so I can understand how she might have missed the discrepancy in the name of the payee. Overall, for all the reasons set out above, on balance, I am not persuaded further intervention by Nationwide would have uncovered the scam and prevented Mrs G’s losses. Mrs G says she understands Nationwide ought to have been able to cancel a card payment while it was still pending. My understanding is that once a debit card payment has been authorised the funds are reserved and the transaction cannot be cancelled. Instead, a chargeback claim can be raised to try and recover funds in certain circumstances. So, while Mrs G called Nationwide to report the fraud while the payments were still showing as pending, I am satisfied Nationwide could not cancel the payments and that raising chargeback claims was the appropriate next step. Chargeback claims are governed by the relevant card scheme rules and allow the customer to challenge the merchant in certain

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circumstances, such as Mrs G’s case, where she did not receive the goods she paid for. But there is nothing to suggest the merchant did anything wrong or was involved with the scammers. The merchant appears to be a genuine overseas travel agent which booked genuine flight tickets and then made payments to a genuine airline. There is no indication the merchant was at fault and it is not clear who Mrs G actually contacted and spoke to when trying to book her flights. From the evidence provided by the merchant, they were instructed to use the funds they were sent by Mrs G to arrange and pay for tickets for another person and they provided evidence that they had provided the services they were contracted to provide to that other person. I appreciate Mrs G received nothing for the payments she made, but it appears the merchant has also been tricked into arranging airline tickets with a genuine airline, based on payments they received from Mrs G which she authorised. In those circumstances, there was little prospect of Nationwide being able to successfully challenge the merchant to get Mrs G’s money back. I cannot see that the failure of the chargeback claims was due to any error by Nationwide. Nationwide raised the claims and pursued them, but they were vigorously defended by the merchant and it seems there was no reasonable prospect of Nationwide being able to take those claims further. I note that Mrs G questions why her bank was able to refund her but Nationwide did not. I understand from Mrs G’s bank that it refunded her account when it first raised the chargeback claim with the merchant, but it did not re-debit her account when the chargeback claim failed. In essence, her bank failed with its chargeback claim too, it simply appears not to have re-debited her account, as a gesture of goodwill or in error. I have no proper basis on which to ask Nationwide to do the same. Overall, while I think Nationwide could have intervened further than it did, for the reasons given above I am not persuaded it is likely that further intervention would have prevented Mrs G from making the payments. I also consider Nationwide did all it reasonably could to try and recover Mrs G’s money. My final decision I do not uphold Mrs G’s complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs G to accept or reject my decision before 21 April 2026. Greg Barham Ombudsman

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