The Banking Ombudsman has denied a woman’s complaint seeking to recover $80,000 from her bank after she fell victim to a scam.

This was the second time the woman had fallen victim to a scam. The woman had previously been conned into transferring money overseas in very similar circumstances, so the bank had placed a block on her account for overseas transfers.

In the second scam, the woman broke her term deposit and purchased $80,000 worth of cryptocurrency before transferring the funds to the scammers via a New Zealand cryptocurrency exchange. The woman then began to regularly transfer funds that the scammers had sent to her account.

The woman stopped transferring the funds after she became suspicious, but she did not realise until a year later that she had been scammed.

The woman made a complaint to the bank, saying that they should have detected the scam and stopped it from happening, given that she had broken her term deposit and had been a scam victim before. The bank failed to respond to the complaint.

The woman then complained to the Ombudsman, who can investigate complaints about its members. In this case, the Ombudsman decided that the bank was not obligated to ask why the woman had broken her term deposit, especially when there was no suspicion of a scam.

The Ombudsman noted that if a bank is suspicious that someone may be the victim of a scam, they are required to look into the matter. However, in this case, there was nothing to notify the bank of the scam.

The Ombudsman rejected the woman’s complaint, deciding that the bank had not breached its obligations. However, the Ombudsman noted that the bank had failed by not considering the woman’s complaint properly.

The bank attempted to recover some of the funds, but due to the time that had passed and the complexities of cryptocurrency transfers, they could not recover anything.

It is important to be aware of your bank’s regulations and ensure that you are treating your accounts safely. If you are confused about how to do this, it pays to seek advice from a professional with experience in the area.


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Alan Knowsley and Hunter Flanagan-Connors