Barclays wins appeal against ruling that it must refund customers who are victims of wire transfer fraud
Barclays has won its appeal against a ruling that it must reimburse its customers who are victims of wire transfer fraud.
The Supreme Court said it was not the bank’s responsibility to “be concerned with the wisdom or risk of its customers’ payment decisions,” following legal action from a disgruntled fraud victim.
Music teacher Fiona Philipp sued Barclays in 2020, saying it should have stopped her from sending large sums of money to bogus accounts in the UAE – in what is known as authorized push payment fraud.
Fraud ruling: Supreme Court said it was not the bank’s responsibility to ‘be concerned with the wisdom or risk of its customers’ payment decisions’
She lost £700,000 and accused Barclays of failing her duty of care.
Yesterday, Supreme Court Justice George Leggatt said the bank was authorized to make the payment and that failing to do so would violate banking law. As a result, he overturned a 2021 Court of Appeal ruling.
He allowed Philipp to file a case that the bank had breached its duty by not taking sufficient steps to recover its money.
Scams like this cost consumers more than £500 million by 2021, according to the payments watchdog, amid concerns that they are on the rise.
The Payment Systems Regulator has put in place plans to introduce mandatory refunds for victims of push payment fraud. Details are discussed.