Bank acted on customer’s instructions to forward money to scammer

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Bank acted on customer’s instructions to forward money to scammer

Categories:

Fraud & scams,

Summary:

Harriet was the victim of a Facebook lottery scam, in which she was led to believe that she had won $700,000. She just needed to make a payment of $50,000 and $20,0000 (to cover tax and administration costs) to have the winnings released to her. Using internet banking, she sent the two payments to accounts in the United States and Australia. About two weeks later, she discovered she had been duped and contacted the bank. It made attempts to recover the money but was unsuccessful. Harriet complained that the bank should not have allowed her to send the funds. The bank disagreed, and she asked us to investigate.

Published:

November 2021

Our investigation

We looked at the bank’s records, which showed that Harriet had properly authorised the payments through internet banking. There was not direct contact with the bank to make the payments (and so nothing to alert the bank to the possibility of a scam). In these circumstances the bank had acted correctly by processing her payment requests. It was not responsible for her loss. Once notified of the scam, the bank had acted very promptly – the same day – in trying to recover the money, but was unfortunately unsuccessful.