TSB Bank plc · DRN-6167487

The complaint The estate of Mrs B (“TMB”) complain TSB Bank plc (“TSB”) mishandled and misappropriated the late Mrs B’s funds that it held in her accounts either through gross negligence or internal fraud. This complaint is represented by one of Mrs B’s sons. To keep things simple, I will mainly refer to TMB in my decision. What happened The details of this complaint are well known by both parties, so I won’t repeat them again here in detail. Instead, I’ll focus on setting out some of the key facts and on giving my reasons for my decision. Mrs B passed in 2024. Mrs B had dementia but did not have any signs of this 2014. Mrs B was moved to a care home in January 2021. So, Mrs B had lived around four years in a care home due to her health. Three of her children had lasting power of attorney and shared the provision of care and responsibility for Mrs B. TMB say when Mrs B passed, they informed her building society who froze her accounts. I will refer to this building society as C going ahead. TMB enquired about an ISA they knew Mrs B had set up in May 2014 with TSB. TMB say the son who handled Mrs B’s banking affairs accompanied Mrs B in May 2014, and recalls her saying she intended to close her TSB account and transfer all her funds to C. TMB were surprised when C informed them Mrs B didn’t have an ISA with it. So TMB visited TSB to establish what had happened to approximately £3,000 - £3,800 that had been in Mrs B’s account. TMB says TSB told them there was no account in Mrs B’s name. So, TMB went to another bank who previously had a relationship with TSB and they said £3,800 had been transferred to a TSB account. TMB say that TSB’s branch staff later said it did have two accounts in Mrs B’s name and they were given two mini statements indicating both accounts had been closed: one in February 2020 and the other in July 2019. TMB say this information was extremely alarming as around that time Mrs B was suffering from moderate dementia. Mrs B never drove and one of her son’s always accompanied her with any banking since May 2014. Because of this TMB say they know the activity on the TSB accounts was fraudulent as Mrs B could not have closed and emptied the accounts. TMB believe employees of TSB have been negligent or deliberately fraudulent in handling Mrs B’s funds. And that Mrs B was targeted because of her vulnerabilities. TMB want any individual involved to be traced, dismissed and referred to the police. And TMB want compensation for the loss of the funds. TMB complained to TSB. As they didn’t get a final response, and eight weeks had passed, TMB referred their complaint to this service. One of our Investigator’s started looking into

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TMB’s complaint. As part of its responses to this service, and in summary, TSB said: • The evidence it has suggests TSB were never made aware of Mrs B suffering from dementia or that there was a power of attorney in place. TSB would have recorded this information if it had been made aware • Both accounts were closed in a branch which has subsequently closed. The TSB partners who closed both the accounts have left TSB since and left no notes at the time • Notes about an account closure are not usually left unless there was something unusual that happened or the customer, or a power of attorney, had asked TSB to record something • Based on what TMB say about Mrs B going into a care home in 2021, this was almost a year after the last account was closed and closing statements were sent to her home address. There is no information which suggests fraud occurred After looking into TMB’s complaint, our Investigator recommended the complaint wasn’t upheld. In summary, the key points they made were: • TSB has provided internal screenshots of the accounts and statements that show the ‘spend and save’ account was funded in June 2014 by a faster payment of £2,061.55. Four counter withdrawals were made between 2014 and 2015 leaving a balance of £1,261.55. There was no further activity until the account was closed in July 2019 • TSB has also sent internal screenshots and statements that show the cash ISA account was funded in May 2014 by a faster payment of £5,776.97. No other deposits were made into the account. The account accrued interest and the closing balance of £6,060.02 was withdrawn in branch in February 2020 • Due to the length of time that’s passed there’s no CCTV footage available to show what exactly happened in branch. Based on the evidence available, they can’t conclude that any fraud or inappropriate activity has taken place on the accounts • Its understandable TMB would like to know what happened to the funds after the accounts closed, but they can only comment on the evidence available • TMB previously said Mrs B went into a care home in 2021 and her house was later sold that year – this was after the accounts were both closed TMB didn’t agree with what our Investigator said. In summary, some of the key points they made were: • TSB will not volunteer any evidence that suggests it was at fault, and its incumbent upon TSB to provide evidence it acted diligently given the seriousness of the mishandling allegation • Has any evidence been presented by TSB to show its security protocols were followed in identifying Mrs B. And it should be noted Mrs B didn’t have a driving licence nor current passport

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• Was this service able to appropriate the account application forms so it could be cross referenced against the information TMB sent in Our Investigator, in short said: • They did ask TSB for information about its account closure processes. TSB confirmed it would have followed the steps which included checking the customers’ account, identifying them, discuss any credit balance and arrange to close the account. TSB sent internal screenshots which show the closure of the accounts and the date that happened • The application form TMB sent in does correlate with the opening of the cash ISA which was opened in May 2014. The agreement was signed in May 2014 too • The dates of the other account application correlates too with TSB’s internal information. The information TSB have provided shows Mrs B opened a current account via the current account switch service (CASS) in May 2014 • It’s possible, despite Mrs B not having a driving licence nor current passport, that she was identified in branch using chip and pin. Due to the branch closing and the passage of time, TSB have no other records about this TMB disagreed with our Investigator’s response. I’d like to assure TMB that I’ve very carefully reviewed everything they have said even if I don’t expressly set out everything here in detail. Some of the key, and novel points, TMB made were: • Mrs B accompanied by one of her son’s requested the full contents of her TSB account to be transferred to C, with a small amount, £3,800 being used to open an ISA with C. This didn’t happen and the funds were retained by TSB • By the time Covid hit in early 2020, Mrs B’s dementia had worsened and she was housebound. Her children shopped for Mrs B and took her meals every day. Mrs B did not attend TSB to close her accounts • The facts of this complaint represent strong circumstantial evidence. TSB are asking TMB to believe that a frail elderly woman with dementia, had in cold weather, left her home to get to TSB where she had no knowledge of the accounts, walked in unaccompanied and left with around £6,000 in cash • TMB say the following questions need to be asked of TSB: o Why was one of the account’s opened on 22 May but not funded until 2 June. And what was the source of the £2,061.55 faster payment o Why was the ISA account opened on 22 May but not funded until 27 May and what was the source of the faster payment of £5,776.97 • TMB were assured no records relating to the accounts would be deleted As there was no agreement, this complaint has been passed to me to decide. What I’ve decided – and why I’m very aware that I’ve summarised the events in this complaint in far less detail than the parties and I’ve done so using my own words. No discourtesy is intended by me in taking

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this approach. Instead, I’ve focussed on what I think are the key issues here. Our rules allow me to do this. This simply reflects the informal nature of our service as a free alternative to the courts. If there’s something I’ve not mentioned, it isn’t because I’ve ignored it. I’m satisfied I don’t need to comment on every individual argument to be able to reach what I think is the right outcome. I do stress however that I’ve considered everything TMB and TSB have said before reaching my decision. I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, I have decided not to uphold this complaint. I note TMB feel strongly about this, so I’ll explain why. TMB say that TSB have either been grossly negligent in protecting Mrs B’s funds or one or more of its staff members have misappropriated the funds fraudulently. TMB add that Mrs B would never have been able to close the accounts down based on the confirmed dates, as above, given her advanced age and substantively poor health which made this impossible. TSB has provided information which shows when the accounts were opened, and when they were defunded and subsequently closed. It’s unfortunate there are not any further records to show what happened at the point of closure and TSB say their staff would not have recorded anything unless they were directed to or Mrs B had told them about any vulnerabilities. Given the lack of evidence here, I cannot find that TSB did anything wrong or its staff fraudulently misappropriated Mrs B’s funds. There are a myriad of permutations that could have happened. Where evidence is inconclusive or incomplete, as is the case here, I can make my findings on the balance of probabilities. A bank is obligated to identify its customers both in branch and through other banking channels before giving them access to the accounts they hold with it. And the records show Mrs B’s accounts were opened, funded by what looks like Mrs B’s accounts with C, and then closed in person. I don’t have any information to say it was more likely that TSB acted negligently or its staff acted fraudulently. For the sake of completeness, I note TMB say there is little information about how the accounts were funded and question why there was a delay from the opening of them to when they were funded. I can’t explain why there was a delay, but I don’t think its uncommon there’s some lag from opening a new account to funds being put in it. The classic account statements TSB have sent me show £2,061.55 was sent by faster payment on 2 June 2014 from a common three letter abbreviation of C. Mrs B is also named in the reference of that payment. TSB’s internal system screenshot shows that a faster payment was made on 27 May 2014 for £5,776.97. The reference names C given the three letter abbreviation I referred to earlier – but it stops short there. I note what TMB say about the delay in the fund entering these accounts from opening, but that isn’t strong evidence that TSB misappropriated, acted negligently and/or fraudulently. If anything, it adds weight that it was most likely Mrs B who funded the TSB account with funds from her accounts with C. For the reasons above, I don’t find its likely TSB, or its staff, acted fraudulently or negligently when handling the late Mrs B’s funds.

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My final decision For the reasons above, I have decided not to uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask the estate of Mrs B to accept or reject my decision before 1 April 2026. Ketan Nagla Ombudsman

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