Bank had no reason to suspect funds were going to fraudster

Common scams targeting bank customers,
In 2021, Raymond joined a WeChat group to exchange advice with experienced investors. One investor sent him a private message, and they began discussing potential investments. The investor would turn out to be a fraudster.
August 2022

After months of conversations, the scammer convinced Raymond to invest in crypto-currency. Raymond paid $40,000 to two New Zealand cryptocurrency brokers, who exchanged his funds for cryptocurrency. The scammer sent Raymond a link to what appeared to be a trusted overseas trading platform and instructed him to transfer his cryptocurrency to the platform. However, the link took him to a mock version of the platform created by the scammer, who stole the cryptocurrency as soon as the transfer went through.

Several months later, Raymond realised what had happened and contacted his bank, but it could not retrieve the funds. Raymond did some online research and discovered such investment scams were common in New Zealand. He considered the bank should have done more to warn him about the risks of cryptocurrency transactions.

Our investigation

Customers are responsible for making sure the person or organisation receiving their funds is indeed who they think it is. In turn, banks are responsible for carrying out customers' instructions. They have no general obligation to ensure customers are making good financial decisions.

In this case, Raymond authorised payments to genuine cryptocurrency brokers. He made the payments using his mobile banking app, and did not tell any bank staff the purpose of the payments. Nothing happened that might have alerted the bank to the possibility the money was going to a fraudster. Furthermore, when Raymond contacted the bank, it tried to recover the funds without any unreasonable delay. We therefore considered the bank was not responsible for Raymond's losses.


We did not uphold Raymond’s complaint.

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