Bank’s scam concerns justified restricting customer’s services

Common scams targeting bank customers,
In 2020, Fred went to a branch of his bank seeking information about how to make international money transfers. He told staff he was in a relationship with a “Jessica” in the United States. Staff became concerned about the authenticity of this relationship and asked the bank’s fraud team to investigate.
July 2022

The team discovered the photos of Jessica matched those of a woman in the United Kingdom. This woman had her own website and an extensive online presence. The bank told Fred about the team’s discovery, but he said he was unconcerned. The bank sent him information from Netsafe about fraudsters using other people's identities in romance scams. The bank also withdrew Fred’s ability to make international money transfers or use his debit card for online transactions. All other account functions remained in place. 

Fred complained that the bank’s actions were unfair and unreasonable. He said he was certain the relationship was genuine, and he was prepared to accept any financial loss if it turned out not to be so.

Our investigation

We told Fred our role was to consider whether the bank had acted fairly and reasonably and in accordance with the terms and conditions of his account, not whether the relationship was genuine. We said a bank usually had to act on a customer’s instructions unless it knew something that would cause it to question the appropriateness of a customer’s instructions. If a bank had information that a customer was at risk of being scammed, it had to take appropriate steps to deal with that risk. The bank assessed him as at risk because he wanted to send funds to a woman whose photos were the same as those of another person in another country. There was no reasonable explanation why two people with different names and living in different countries could have the same photos. We concluded the bank had acted reasonably by restricting his banking services. The terms and conditions of his account allowed the bank to do this if it suspected fraud. 


We did not uphold Fred’s complaint.

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