Barclays not liable for couple defrauded of £700,000

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image copyrightReuters
image captionThe bank is not liable for paying £700,000 back to the couple

A bank does not need to compensate a customer who was duped into paying £700,000 to fraudsters, a judge ruled.

Fiona Philipp used her Barclays account to transfer two payments of £400,000 and £300,000 to accounts in the United Arab Emirates.

She and her doctor husband thought they were helping a high-profile fraud investigation being run by the Financial Conduct Authority (FCA).

The bank said the customer had made the payments willingly.

The scam started when her husband was called by a man who claimed to work for the FCA.

He told him that his bank, HSBC, and an investment company he had savings in, were unsafe and at risk of fraud.

'Unpleasant vice'

In order to keep the money safe, the conman said it had to be transferred into "safe accounts" before his investigation could be completed.

Dr Philipp, a retired consultant who was based at the Bristol Royal Infirmary, said it had become unclear who was genuine and that it was like "being squeezed in a very unpleasant vice, not knowing who to trust".

The couple visited Barclays branches in Gloucestershire and Bristol in March 2018 in an attempt to pay £400,000 into the "safe accounts".

Mrs Philipp, a retired music teacher, emailed copies of her passport and driving licence to the fraudster and then the next day visited Barclays' Westbury-on-Trym branch to make another £300,000 payment.

He manipulated the couple to the extent that they allowed him to listen to meetings they had at the bank on an open line on the man's mobile phone, a High Court judgement said.

'Fanciful'

In March 2018, an officer from Avon and Somerset Police visited the couple three times to warn them they were the victims of fraud after receiving intelligence from other police forces.

But only on the third meeting did they accept they were being defrauded, just two days after they had sought to process another £250,000 through to the "safe account" on 26 March.

That failed after Barclays blocked any further payments from it.

The written judgement from the High Court was published on Monday ruling in favour of Barclays Bank plc.

In it, Judge Russen QC said he felt "acute sympathy" for the couple who had "fallen victim to the dishonesty" of the fraudster but added "it would not be fair, just or reasonable to impose liability" on the bank.

The court heard that the woman's disclosure of security details to the fraudsters "involved clear breaches" of the bank's terms and conditions.

Alexia Knight, for Barclays, said it was "fanciful" to think that the fraud would have been stopped if the bank had asked more "safeguarding questions".

Avon and Somerset Police has been contacted for comment.

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