Nationwide Building Society · DRN-6261685

The complaint Mr G complains Nationwide Building Society (‘Nationwide’) hasn’t reimbursed him following an Authorised Push Payment (‘APP’) investment scam he fell victim to. He says Nationwide should reimburse him for the money he lost. Mr G has brought the complaint with the assistance of a professional representative. For ease of reading within this decision, I will refer to Mr G in the main. What happened As both parties are familiar with the circumstances of this complaint, I’ve summarised them briefly below. Mr G was introduced to an investment company – which I’ll refer to as ‘Company B’, by family members. Mr G says one of his family members, a cousin, was the brother-in-law of one of the Directors of Company B. Due to the family recommendation and that those other family members investments were getting returns as expected, Mr G decided to invest also. Between 2017 and 2021, Mr G entered into five agreements with Company B. Mr G, due to the size of the investments, had to split the payments into smaller amounts and on occasion he sent funds from more than one of his own accounts. And they were made to the various bank account details he was provided for Company B or its Directors. I’ve set out the relevant information below: Date Payer Bank account Total amount sent Investment agreement 23/08/2017 Nationwide £100,000 1 25/10/2018 Nationwide £30,000 2 26/10/2018 ‘Bank U’ £70,000 2 22/02/2019 Nationwide £100,000 3 23/03/2020 Nationwide £175,000 4 03/08/2020 ‘Bank U’ £20,000* *N/A as returning an overpayment received from Company B 04/08/2020 ‘Bank U’ £18,000* *N/A as returning an overpayment received from Company B 30/06/2021 Nationwide £60,000 5 30/06/2021 ‘Bank N’ £20,000 5 30/06/2021 ‘Bank L’ £20,000 5 Total paid *£575,000 *Not including the returned overpayments. Mr G’s understanding was that he would enter into a ‘managed fund agreement’ with Company B, on the basis that his funds would be used for general investment purposes (stocks and shares and Foreign Exchange ‘Forex’ trading). Mr G initially expected monthly returns paying 5%. And then subsequently, when he was renewing/rolling over the contracts, the monthly rate offered was slightly lower and over time it also changed to expected annual returns of 50% – and if returns exceeded that amount, Company B would be entitled to a

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performance fee. In April 2021, Mr G merged four of the agreements into one £400,000, 12 month investment agreement. Between September 2017 and April 2021, Mr G received 54 payments totalling £470,000 in relation to his investment agreements with Company B. The payments were received into Mr G’s bank account with Bank U. Mr G also received £38,000 from Company B that was made to him in error which he subsequently sent back. Mr G has provided his statements and explained that the returns for each investment agreement were as follows: Investment agreement number Total amount(s) received 1 £220,000 2 £122,500 3 £62,500 4 £65,000 5 £0 Total received *£470,000 At this point, I would like to add that Mr G also made a number of international payments in 2021, from his account with Bank U, in relation to an overseas investment trading company - that I’ll call ‘M’ that he was introduced to by Company B. Mr G signed a Limited Power of Attorney with M, giving Company B authority to trade the investment capital on his behalf, entitling Company B to a percentage of any profit made. Mr G made eight international payments to M between March and May 2021 totalling £100,001. It seems by mid-2022 a combination of poor choices and high-risk trading decisions resulted in Company B losing all the investment capital investors had deposited and traded through M, along with any investment capital Company B had invested itself. In July 2021, Nationwide received some reports from other customers regarding Company B. As a result, it contacted customers who had paid the various beneficiary accounts in question, and it spoke with Mr G at this time also. Mr G having the history of investing with Company B and the connection he had built over the years, didn’t believe Company B was fraudulent. Ultimately, Company B stopped paying returns, and Mr G said he was provided with various excuses as to why he wasn’t receiving the payments he believed he was owed. Company B also subsequently entered into administration. Mr G came to realise that he had been the victim of a scam. Mr G, through his professional representative, complained to all his banking providers to try and recover his funds or be reimbursed his losses. Mr G complained to Nationwide in January 2024 and considered he should be reimbursed his loss under the Lending Standards Board (‘LSB’) Contingent Reimbursement Model (‘CRM’) Code. This was a voluntary code which was in force at the time of investment 4 and 5 and which Nationwide was a signatory to. The CRM Code required firms to reimburse customers who had been the victims of APP scams in all but a limited number of circumstances. Nationwide issued its final response to Mr G on 7 February 2024. It considered that the payments Mr G made in 2017 had been made more than six years before the claim was made – so it didn’t consider they should be included in its investigation. With the other

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payments, Nationwide considered they were made to a legitimate company that got into financial difficulty and entered into liquidation. It didn’t consider that the payments were made as a result of a scam and didn’t consider it was liable to refund Mr G for any funds he had lost. It also advised that it had taken into consideration the comments that Company B were operating a Ponzi scheme but didn’t consider there was sufficient evidence to support that notion and deemed the matter to be a civil dispute. It further advised it would review Mr G’s complaint again if the outcome of an investigation by law enforcement or other statutory body concluded that Company B acted with fraudulent intent. Unhappy with the response, Mr D referred the matter to our service. Mr G also referred complaints to this service about his other banking providers from where he made payments. I think it’s important to briefly highlight the outcomes of those complaints, for completeness and awareness, as Mr G received some refunds which I will need to take into account in any award or direction I make in relation to this complaint. In summary, Mr G’s complaint: • about the payments he made from Bank U to both Company B and the overseas trading company wasn’t upheld. The findings reached were that the payments were made prior to the implementation of the CRM Code – so it wasn’t an applicable consideration. As a result, the opinion was that Mr G would have likely proceeded with the payments to Company B at the time, based on his belief that it was a genuine investment. So, the opinion was that Bank U couldn’t have prevented the loss. And for the payments made to the overseas trading company, it was deemed that they didn’t meet the Financial Conduct Authority’s (‘FCA’) definition of an APP scam. This was because the purpose Mr G made those payments, aligned with the receiver’s purpose – that being used for investment purposes; and • about the payments he made from both Bank N and Bank L (where he sent £20,000 from each bank), the complaints led to both banks reimbursing him in full for those payments under the CRM Code. One of our Investigators looked into the complaint about Nationwide and upheld Mr G’s complaint, in part. In short, they considered: • Mr G’s complaint about the payments he made in 2017 were complained about, and referred, within the relevant time limits. While the payments had been made over six years before Mr G made his claim, they explained Mr G was unaware he had cause for a complaint at that time. And they considered he had subsequently referred the complaint within the applicable three-year time limit once aware he had cause for complaint. • They were satisfied the evidence available indicated Company B were operating a scam. • Nationwide couldn’t have prevented Mr G from proceeding with the payments that were made prior to May 2019 (which was when the CRM Code came into force). • They were of the opinion Mr G should be reimbursed the payments from March 2020 onwards under the CRM Code and didn’t consider any exceptions to reimbursement applied as Mr G held a reasonable basis of belief at the time. Our Investigator considered the redress owed to Mr G by Nationwide amounted to £80,750 and that Nationwide should add 8% simple interest on that amount, from the date it declined

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Mr G’s claim under the CRM Code until the date of settlement. They also considered that Nationwide could take an assignment of rights to any funds returned to Mr G, via the police investigation, before paying the award. Mr G accepted the findings, however Nationwide did not. In short, Nationwide disagreed and considered within the Investigators view it was stated that some of the funds paid to Company B (around £4.7 million) were invested, and it is not known whether Mr G’s funds formed part of that amount. So, in essence, pointing out that if Mr G’s funds were used towards investment, then it supports its position that it was a failed investment and Mr G wasn’t the victim of a scam. Our service, due to data protection laws, was unable to share with Nationwide specific information about the beneficiary account(s), such as the statements we had obtained – as they had been provided by the relevant beneficiary banks in confidence to allow our service to discharge our investigatory functions, which is to enable the determination of the complaint as to whether Company B was likely operating a scam. But a summary of Company B’s accounts and its income and expenditure was provided to Nationwide in July 2025. As an informal agreement could not be reached, the complaint was passed to me for a final decision. I issued a provisional decision on 6 March 2026 as, while I was minded to reach the same outcome as our Investigator, I wanted to provide some additional reasoning and to also set out what I considered to be fair redress in the circumstances, as it differed to our Investigator’s recommendation. For completeness I will provide the findings from the provisional decision: “In deciding what’s fair and reasonable in all the circumstances of a complaint, I’m required to take into account relevant: law and regulations; regulators’ rules, guidance and standards; codes of practice; and, where appropriate, what I consider to have been good industry practice at the time. First, the main point of dispute is whether Company B was operating as a scam or not. Nationwide has highlighted that there is an ongoing police investigation into Company B. And it has said that it is happy to review the case again upon an outcome of an investigation by law enforcement or other statutory body that concludes Company B acted with fraudulent intent. So, I have considered whether it would be appropriate to delay my decision in the interests of fairness. There may be circumstances and cases where it’s appropriate to wait for the outcome of external investigations. But that isn’t necessarily so in every case, as it may be possible to reach conclusions on the main issues on the basis of evidence already available. And it may be that the investigations or proceedings aren’t looking at quite the same issues or doing so in the most helpful way. In order to determine Mr G’s complaint, I have to ask myself whether, on the balance of probabilities, the available evidence indicates that it’s more likely than not that Mr G was the victim of a scam rather than a failed investment. But I wouldn’t proceed to that determination if I consider fairness to the parties demands that I delay doing so. I’m aware that Mr G first raised his claim with Nationwide in January 2024, and I need to bear in mind that this service exists for the purpose of resolving complaints quickly and with minimum formality. With that in mind, I don’t think delaying giving Mr G an answer for an

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unspecified length of time would be appropriate unless truly justified. And, as a general rule, I’d not be inclined to think it fair to the parties to a complaint to put off my decision unless, bearing in mind the evidence already available to me, a postponement is likely to help significantly when it comes to deciding the issues. I’m aware the above ongoing processes might result in some recoveries for Company B’s investors. In order to avoid the risk of double recovery, I think Nationwide would be entitled to take, if it wishes, an assignment of the rights to all future distributions to Mr G under those processes in respect of this investment before paying anything I might award to him on this complaint. For the reasons I discuss further below, I don’t think it’s necessary to wait for the outcome of the ongoing police investigation for me to fairly reach a decision on whether Nationwide should reimburse Mr G whether under the provisions of the CRM Code or otherwise. In order to reach a decision, I’ve considered the definition of an APP scam under both the FCA Handbook Glossary and the CRM Code. The FCA’s definition states: “…authorised push payment fraud a transfer of funds by person A to person B, other than a transfer initiated by or through person B, where: 1. A intended to transfer the funds to a person other than B but was instead deceived into transferring the funds to B; or, 2. A transferred funds to B for what they believed were legitimate purposes but which were in fact fraudulent.” And the CRM Code, under DS1(2) defines an APP scam as: “…a transfer of funds executed across Faster Payments, CHAPS or an internal book transfer, authorised by a Customer in accordance with regulation 67 of the PSRs, where: (i) The Customer intended to transfer funds to another person, but was instead deceived into transferring the funds to a different person; or (ii) The Customer transferred funds to another person for what they believed were legitimate purposes but which were in fact fraudulent.” DS2(2)(b) also explains that the CRM Code does not apply to: “private civil disputes, such as where a Customer has paid a legitimate supplier for goods, services, or digital content but has not received them, they are defective in some way, or the Customer is otherwise dissatisfied with the supplier” Both the above definitions of an APP scam require a customer to transfer funds for what they “believed were legitimate purposes but which were in fact fraudulent”. So, I’ve therefore considered whether or not Mr G’s intended purpose for the payments was legitimate, whether or not the intended purposes of Mr G and Company B were substantially aligned

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and, if not, whether or not this was the result of dishonest deception on the part of Company B. Mr G transferred a considerable sum of monies to Company B which he believed would be used for general investment purposes (stocks and shares and Foreign Exchange ‘Forex’ trading) and expected monthly and then annual returns as per his relevant agreements. Mr G believed Company B was a legitimate company and that his purpose for paying Company B was legitimate also. I’ve then considered whether there’s convincing evidence to demonstrate that Company B’s purpose for the payments was fraudulent. That is, whether Company B’s purpose must have been to misappropriate Mr G’s funds or otherwise deprive him of his money, rather than to use it for the purpose believed by Mr G. It’s evident that Company B had some features that gave it the impression of operating legitimately. There are those individuals associated with Company B who held in-person meetings and online events to promote the investment. And many people who lost money had been introduced to the scheme through personal recommendations (sometimes by people who’d successfully withdrawn significant ‘profits’ from the scheme). However, I’ve found the following facts to be persuasive evidence that Company B was operating as a scam: • Company B received around £28,000,000 in investment funds – however, of these funds, only around £4,700,000 appears to have been invested (so less than 17% of funds received) – and of this money invested, Company B made a loss of around £600,000. • Despite this low proportion of investment, Company B still paid out around £19,000,000 to investors (so around 68% of capital received). Therefore, it seems a large proportion of ‘returns’ investors were seeing weren’t in fact investment returns – but funds provided to Company B by other investors. • It therefore seems that Company B was providing funds to investors to provide the impression that it was performing as expected, the likely intention of which was to obtain further investment into what was an overall scam. • Additionally, while not all payments were made directly to Company B, we’ve seen evidence that notable proportions of payments made to other firms were passed on both to Company B and other firms under the same director, with little to no evidence of genuine trading activity. • It also appears Company B misled investors about the need to be authorised by the FCA. It said in the managed fund agreement that this was a ‘Private Investment Fund’, and as such, clients acknowledge and accept its not subject to the regulations of the FCA. However, Mr G as a general member of the public, was a retail investor, and as such shouldn’t have been the target market for such an investment, if it was indeed a Private Investment Fund. Furthermore, it’s our understanding, given Mr G’s status as a retail investor, that Company B ought to have been authorised when it wasn’t. Turning to Nationwide’s concern raised in response to the Investigator’s view. I accept that Company B did transfer approximately £4.7 million to a trading platform. So, I can understand Nationwide’s concerns that some/all of Mr G’s funds may have been used for the

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intended purpose of trading. However, the trading platform has been unable to provide this service with Company B’s trading records. This means we can’t say for certain what happened to the funds once they were transferred to the trading platform. So, I must make an on balance finding as to what I consider is most likely to have happened to those funds. I acknowledge it’s possible the funds were traded on behalf of Mr G and other investors by Company B. However, it’s also possible that those funds were simply withdrawn from the trading platform without ever being traded, or traded for the sole benefit of Company B. The trading platform has confirmed that Company B traded using credit it received from the trading platform. So, it’s also possible that funds sent to the trading platform were used to pay off debt Company B had accrued through poor trading decisions, rather than being traded for the benefit of investors. Of the £4.7 million Company B sent to the trading platform (less than 17% of the investment capital Company B received from investors), only £4.1 million was returned to Company B, indicating a trading loss of £0.6 million. Despite this trading loss, Company B paid out approximately £19 million to investors as returns. So, this strongly suggests it is most likely that the large amount of money Company B paid to investors as returns wasn’t funded by legitimate trading activity and was, instead, funded using new investors’ funds, giving the false appearance that Company B was running a successful forex trading investment enterprise. The evidence suggests to me that Company B wasn’t a legitimate investment opportunity and was, most likely, an APP scam. So, I can’t say that any funds sent to the trading platform were, more likely than not, used for the purpose in which they were intended to be used. To my mind, investors, like Mr G, were dishonestly deceived about the very purpose of the payments they were making and the evidence of funds being sent to a trading platform does not, in my opinion, demonstrate Mr G’s funds were traded on his behalf as intended. Taking into account all of the above, I’m satisfied, on the balance of probabilities, that the money that was intended for and sent to Company B by Mr G was not used for its intended purpose. The evidence suggests that Mr G wasn’t involved in a failed investment but a scam. Returning to the question of whether, in fairness, I should delay reaching a decision pending developments from external investigations, I have explained why I should only postpone a decision if I take the view that fairness to the parties demands that I should do so. In view of the evidence already available to me, however, I don’t consider it likely that postponing my decision would help significantly in deciding the issues. There is no certainty that any prosecutions will result from the police investigations nor what, if any, new light they would shed on the evidence and issues I’ve referred to. So, as I’m satisfied Mr G has most likely been the victim of an APP scam, I’ve considered whether Nationwide could have prevented Mr G’s losses for the earlier payments made (prior to the implementation of the CRM Code) and whether he should be reimbursed for the payments made after the implementation of the CRM Code. The payments made prior to the implementation of the CRM Code Mr G made payments toward Company B and/or its Directors in August 2017, October 2018, and February 2019. First, I would like to add here briefly that the payments Mr G made in 2017 have been referred within the ‘six and three year’ time limits applicable to this service – namely under the three-year part of the test, as our Investigator explained. Nationwide hasn’t contested

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this or made any additional comments in relation to this, so I don’t consider I need to comment further on this aspect. In broad terms, the starting position at law is that a Payment Service Provider (in this case, Nationwide) is expected to process payments that a customer authorises it to make, in accordance with the terms and conditions. It is the case that Mr G authorised all the payments in dispute and that’s accepted by all parties. And under the Payment Service Regulations (both the 2009 and 2017 regulations which are the relevant regulations in place here) that means Mr G is responsible for the payments. That remains the case even though Mr G was the unfortunate victim of a scam. There are times when, dependent on the payment, I might expect a firm to question a transaction or payment, even though it may have been properly authorised. Broadly speaking, firms (like Nationwide) should fairly and reasonably have been on the lookout for the possibility of fraud in order to protect its customers from fraud. But, and importantly, I have to determine whether any interventions would have made a difference and prevented Mr G from proceeding with the payments – thereby preventing the loss. I will keep my comments here brief as Mr G accepted the Investigator’s opinion and findings on this point. Mr G was recommended the investment by a family member, and other family members had invested also. Those individuals that had invested were receiving returns as expected. Given the connection of Mr G’s cousin being a brother-in-law for one of the Directors and then having met the Director of Company B in person, Mr G considered it was a genuine investment opportunity. So, I can’t fairly say that had Nationwide intervened on the initial investment that it would have made a difference and prevented Mr G from proceeding with the payments. There wasn’t any adverse information available about Company B at the time either. I then also have to bear in mind that Mr G’s initial investment went as expected, so when it came to him entering into further agreements in 2018 and early 2019 his belief that all was genuine would have been increased further still. So, I don’t consider Nationwide are liable for those payments as I’m not satisfied that it could have prevented Mr G’s loss. The payments Mr G made that were after the implementation of the CRM Code Nationwide was a signatory to the CRM Code which came into force in May 2019. It required firms to reimburse victims of APP scams in all but a limited number of circumstances. Under the CRM Code there are generally two exceptions to reimbursement: • Mr G made the payments without a reasonable basis for believing that they were for genuine goods or services; and/or Company B was legitimate. • Mr G ignored what the CRM Code deems to be an ‘Effective Warning’ And importantly, when assessing whether it can establish these things, Nationwide must consider whether they would have had a ‘material effect on preventing the APP scam’. I have considered whether Mr G had a reasonable basis to believe Company B was legitimate and was providing a genuine investment product. As touched on above, Mr G had invested with Company B and had been doing so for a number of years. I consider at the time of being introduced initially, it was done so through family members who had already invested, and Mr G’s cousin was a brother-in-law of one of Company B’s Directors. Given this, I don’t think his belief was an unreasonable one at that

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time. And Mr G’s earlier investment agreements had gone to plan with the returns expected being received. So, I consider when Mr G made further payments (when the CRM Code was in force) he held a reasonable belief that it was a genuine investment opportunity. I accept some of the claims made by Company B about the returns it could generate seem unlikely. But, and importantly, alongside this I also have to weigh up what Mr G had been told about Company B by other family members, and what he had seen those other individuals seemingly get back in returns and how their investments were doing. I think the sophisticated aspects of the scam and the recommendations he received from those he trusted, outweighs the concerns that Mr G perhaps ought to have had about the returns being claimed. And again, I also have to bear in mind that his investments were receiving the returns as promised, until things went awry later on down the line. On balance, I think there was enough to reasonably convince Mr G at the time that this was a genuine investment company. With this in mind, I don’t think Mr G made the payments without a reasonable basis of belief that Company B and the investment itself were genuine. I have also considered whether Nationwide can rely on the exception to reimbursement that Mr R ignored what the CRM Code deems to be an ‘Effective Warning’. However, I am also mindful the CRM Code explains that a firm, in assessing whether an exception to reimbursement applies such as ignoring an effective warning, has to take into account whether it would have had a ‘material effect on preventing the APP scam’. Here Mr G had no reason to believe that Company B wasn’t a genuine investment company at the time – and had been receiving returns as expected. So, I think it is fair to say that any warning Nationwide provided wouldn’t have had a material effect on preventing the scam. It wouldn’t have been wholly unreasonable for Mr G to have moved past any warnings provided or to potentially not give a warning sufficient attention; such was Mr G’s belief in things and that Company B was a legitimate investment company whom he had been paying for a number of years. So, I do not think an exception to reimbursement can be applied for this reason in any event. With the above in mind, I don’t think any of the exceptions to reimbursement under the CRM Code apply here. Outside the provisions of the CRM Code, I consider it unlikely that any intervention by Nationwide at the time of those payments would have positively impacted Mr G’s decision- making. I don’t think either party would have likely uncovered sufficient cause for concern about Company B at the time such that Mr G would have chosen not to proceed. Summary Overall, I do not consider it necessary to await the outcome of the ongoing police investigations into Company B and any subsequent proceedings that may happen as a result. I am satisfied, based on the evidence available, that Mr G was more likely than not the victim of an APP scam. So, it follows that I’m satisfied Mr G is due some redress from Nationwide. And Nationwide is entitled to take, if it so wishes, an assignment of the rights to all future distributions to Mr G under any processes relating to the police investigation and any potential compensation that may be returned to victims. Putting things right I intend to uphold this complaint; however Mr G received credits/returns from Company B and has also received refunds from Bank N and Bank L, which are important and needs to be taken into consideration. I’ll explain why.

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Mr G received a large amount in returns from Company B. So, Mr G received £470,000 as a result of Company B’s fraudulently activity. When I consider this, and what is fair and reasonable in the circumstances of this complaint, I’m satisfied that it is fair that the returns Mr G received overall need to be taken into account when determining what is the fair redress Nationwide need to pay him. Mr G received all the credits from Company B into an account he held at Bank U. And he has also received reimbursement for the payments he made from two of his other banking providers – Bank N and Bank L (£20,000 from each). Mr G has provided us with the relevant information and statements in order to help determine what fair redress looks like when taking into account the credits he received back from Company B and the refunds from Bank N and Bank L. What does fair redress look like? When Mr G brought the complaints about all his banking providers (including the payments he made to the overseas trading company) – he considered the loss from all the payments he made was £713,001. However, for the payments totalling £100,001 that he made to the overseas trading company – that complaint wasn’t upheld as it wasn’t deemed that definition of an APP scam had been met and the purpose Mr G made those payments aligned with the receiver’s purpose – that they would be traded which they were. While that money was ultimately lost – it wasn’t lost to a scam as per the FCA’s definition of an APP scam. So that £100,001 isn’t to be included in the scam loss about Company B. And for the £38,000 that Mr G paid to Company B on 3 and 4 August 2020, this was him returning that amount as Company B had sent it to him in error. So, there isn’t a loss there – they nullify each other. So the amount of £38,000 needs to also be deducted from the £713,001 also. Finally, Mr G received £20,000 from both Bank N and Bank L. So that £40,000 also needs to be deducted when working out what his outstanding loss actually is. Therefore, the total of all the payments Mr G made to Company B for his ‘managed fund agreement’ investments, from all his banking providers, is £535,000. As explained, Mr G received money back that he understood to have been ‘profits/returns’ from his investment(s). Given Mr G was falling victim to a scam and his ‘investments’ weren’t genuine, I don’t think the returns he received should be attributed to any specific payments. Instead, I think this money should be deducted from the amount lost by apportioning it proportionately across all of the payments Mr G made to the scam. This ensures that these credits are fairly distributed. To work this out, Nationwide should take into account all of the payments Mr G made to the scam (including those from other businesses – that haven’t already been refunded and those payments which aren’t covered by the CRM Code), which I’ve set out in the table above. In this case, the ‘profit/returns’ received equals £470,000 and the total amount paid to the scam equals £535,000 (when factoring in the payments that should no longer be included as they were either not made to a scam, was Mr G returning an overpayment or had been an amount refunded to him from Bank N and Bank L).

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Nationwide should divide the ‘profits/returns’ by the total amount paid to the scam. This gives the percentage of the loss that was received in ‘profits/returns’. Deducting that same percentage from the value of each payment after May 2019 (so the payments being upheld after the CRM Codes implementation) gives the amount that should be reimbursed for each payment. Here the ‘profit/returns’ amount to 87.85% of the total paid to the scam. It follows that the outstanding loss from each payment after May 2019 should be reduced by the same percentage. That means Nationwide should reimburse 12.15% of each payment after May 2019. Please note that, for ease of reading, I’ve rounded the relevant percentages down to two decimal places, but Nationwide should perform the calculation I’ve set out above to arrive at a more precise figure, as I have done to arrive at the figure below. After taking the steps set out above, I calculate the outstanding loss from the payments Mr G made from his Nationwide account, and that are being upheld under the CRM Code, to be £28,551.40. Therefore, I intend to direct Nationwide Building Society to pay Mr G: • £28,551.40 lost to the scam orchestrated by Company B, (as reasoned and calculated above) and; • 8% simple interest on that amount from the date it declined Mr G’s claim under the CRM Code (which was 7 February 2024) to the date of settlement.” Nationwide responded, accepting the provisional decision. Mr G’s representative agreed with the overall outcome I had reached but considered the approach I had taken in determining the redress wasn’t fair. Mr G’s representatives put forward two alternative approaches for me to consider: • that all payments Mr G made should be considered within the calculation for proportionality purposes – so including those to the overseas trading company and the payments made to Bank N and Bank L, making the outstanding loss £61,336.48; or • only the returns reasonably attributable to reimbursable payments should be considered, making Mr G’s loss £55,250. 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. Nationwide has accepted my provisional findings, and neither party has provided any further comments or testimony in relation to the outcome I reached that Mr G was the victim of an APP scam and what that meant for the payments Mr G made prior to, and after, the CRM Code’s implementation. Mr G’s representative has provided two approaches for me to consider as an alternative to the redress I proposed.

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There can be a number of approaches and factors to consider when determining what fair redress looks like in all the circumstances of a complaint. As the deciding ombudsman, it is for me to determine what I consider to be fair redress in the circumstances of the complaint. In doing so, I can’t comment on other decisions by our service. Here, as I’m required to do, I’ve looked at the individual circumstances of Mr G’s complaint. As a starting point, all parties agree that this was a scam. The money that was paid to Mr G wasn’t really generated by the supposed investments made. I think they were merely inducement to ensure that Mr G kept investing or to demonstrate that apparent success of the scheme. So, I reject an analysis which attempts to attribute specific returns to specific payments as if they were real investments generating real returns. Instead, the principle I’ve applied is that all the payments to the scam must be apportioned against all the credits received from it. This method ensures a fair distribution of credits across all the payments. Inevitably there will be circumstances where this benefits or disadvantages either party, but I don’t think, as Mr G’s representatives argue, that it is unfair to either party. In addition, the complaint about the payments Mr G made from Bank U to the overseas trading company wasn’t upheld, as the payments didn’t meet the FCA’s definition of an APP scam. There has been no evidence provided that suggests that any of, or even a part of, the returns Mr G received from Company B were from the overseas trading company. So, it wouldn’t be fair for the payments Mr G made from Bank U to the overseas trading company to be included in the calculation. Mr G’s representatives argue, as an alternative, that the refunds from Bank N and Bank L should not be taken into account when performing this calculation. One reason it suggests is that these payments took place after any returns were received – but as I’ve explained – I don’t think this is relevant. It also suggests that I should instead apportion the returns across all of the payments, including the payments made from Mr G’s accounts at Bank N and Bank L. I respectfully disagree with this analysis too. If I were to apportion across the payments made from Bank N and Bank L, despite the fact that those payments have already been reimbursed, Mr G would be significantly over-compensated for those specific payments because I would be apportioning credits to payments that have been refunded in full. So, all things considered, I remain of the opinion that the calculation, as set out within my provisional decision, is a fair and reasonable way to put things right. My final decision For the reasons given above, and within my provisional decision, I uphold this complaint in part. I direct Nationwide Building Society to put things right as I set out in my provisional decision. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr G to accept or reject my decision before 27 April 2026. Matthew Horner Ombudsman

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