American Express Services Europe Limited · DRN-6159542

The complaint Ms G complains that AMERICAN EXPRESS SERVICES EUROPE LIMITED won’t refund the money she lost as the result of a scam. What happened In 2025 Ms G had just started a new job. She received an email which she believed to be from her boss, asking her to buy some gift cards as a surprise for staff members. Unfortunately, it ultimately turned out that the email was from a scammer, and I’ll refer to the sender as “the scammer” in this decision, even though I appreciate that Ms G didn’t realise that’s who she was dealing with at the time. Ms G didn’t see any reason to suspect that the email was anything other than genuine, and she went ahead and bought the requested gift cards. The total came to £1,500, which Ms G paid in a single transaction, using her personal American Express credit card. She then emailed the gift cards to the scammer. Shortly after receiving the cards, the scammer emailed Ms G and asked her to buy the same number of gift cards again. Ms G made a further single payment of £1,500 for the additional cards, and again forwarded them to the scammer. An hour or so later, the scammer asked Ms G to buy a further batch of gift cards. This time he asked for £2,000’s worth of cards. American Express’s anti-fraud system picked up the transaction, which was declined. Ms G says a colleague phoned her boss and established that the requests to buy the gift cards hadn’t come from him. At that point, Ms G realised she’d been scammed. Ms G raised a fraud claim with American Express, but it told her that she’d remain responsible for the payments. One of our investigators considered the complaint, but didn’t think it should be upheld. In summary, the investigator didn’t think that American Express could reasonably have been expected to intervene when Ms G made the two payments of £1,500, and they didn’t think it could have recovered her money. Ms G didn’t agree with the investigator’s view, so the complaint’s been passed to me. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I’d like to say at the outset that I was very sorry to learn that Ms G lost money to an opportunistic scam. I have considerable sympathy for her. It seems particularly cruel that this happened while she was settling into a new job, and when she thought she was helping her boss. I don’t doubt that she acted, as she says, in good faith. But it doesn’t automatically

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follow that I can fairly hold American Express, which wasn’t itself involved in the scam, responsible for Ms G’s loss. Having thought carefully about all the evidence and arguments provided by both parties, I’m not upholding the complaint. I’ll explain why. It’s not in dispute that Ms G made and authorised the payments, albeit under a misapprehension about the source of the emails she’d received. The starting point is that American Express had an obligation to follow the payment instructions it received, and Ms G is presumed liable for her loss in the first instance. But that’s not the end of the matter. The Payment Systems Regulator’s mandatory scam reimbursement rules, which came into effect in October 2024, don’t apply in this case. That’s because they don’t cover payments made by card. In deciding what’s fair and reasonable, I’m required to take into account relevant law and regulations, regulators’ rules, guidance, standards and codes of practice and, where appropriate, what I consider to have been good industry practice at the time. Taking those things into account, I think that at the time the payments were made, American Express should have been doing the following to help protect its customers from the possibility of financial harm: • monitoring accounts and payments to counter various risks, including fraud and scams; • keeping systems in place to look out for unusual transactions or other signs that might indicate that its customers were at risk of fraud (among other things) – especially given the increase in sophisticated fraud and scams in recent years, with which financial institutions are generally more familiar than the average customer; • acting to avoid causing foreseeable harm to customers, for example by maintaining adequate systems to detect and prevent scams and by ensuring that all aspects of its products, including the contractual terms, enabled it to do so; • in some circumstances, regardless of the payment method used, taking additional steps, or making additional checks, before processing a payment, or, where appropriate, declining to make a payment altogether; and • being mindful of - among other things – common scam scenarios, how fraudulent practices were evolving (including, for example, the common use of multi-stage fraud by scammers) and the different risks these can present to consumers when deciding whether to intervene. There’s a balance to be struck. Banks have obligations to be alert to fraud and scams and to act in their customers’ best interests, but they can’t reasonably intervene in every transaction. To do so would involve significant disruption to legitimate payments. I recognise that the two payments of £1,500 that Ms G made represent a significant amount of money to the average person. I acknowledge that they were made in relatively quick succession. But they weren’t so high, either individually or together, that I’d have expected American Express to be concerned about them based on their size. And it isn’t unusual for people to use credit cards to make substantial purchases. I’ve also borne in mind that they were made to a legitimate merchant. Overall, I don’t consider that there was anything about the payments that ought to have prompted American Express to be concerned that Ms G was at risk of financial harm from fraud, or to intervene before processing them.

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When Ms G went on to attempt a third payment, American Express recognised the risk and blocked it. I think it acted reasonably in doing so, and its action resulted in the further payment not being made. But this doesn’t imply that American Express should have intervened when Ms G made the first two payments. And as I don’t find that it should have done so, there’s no need for me to consider what might have happened if it had. I’ve thought about whether American Express could have done more to recover Ms G’s money, but I don’t think it could. I’ve seen no suggestion that there was any breach of contract or misrepresentation by the retailer, so I can’t see that American Express could be held responsible under section 75 of the Consumer Credit Act. The chargeback scheme covers payments made by card. In this case, there’s been no suggestion that the retailer failed to provide Ms G with genuine gift cards. The loss occurred when Ms G sent them on to the scammer. So I think it unlikely that a chargeback claim would succeed. American Express did, nonetheless, raised disputes for the two payments. I don’t consider that it could reasonably have been expected to do more. And I can’t see any other way in which American Express could have recovered Ms G’s money. Finally, I acknowledge that Ms G has told us that she had to chase American Express up. I appreciate that she says she had to repeat some information, but I don’t consider that the inconvenience of having had to do so is enough to merit an award of compensation. I recognise that my decision will come as a considerable disappointment to Ms G, and I feel for her. But for the reasons I’ve set out, I can’t fairly uphold her complaint. My final decision My decision is that I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Ms G to accept or reject my decision before 21 April 2026. Juliet Collins Ombudsman

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