Thousands of Monzo customers have been wrongly denied refunds for being scammed out of their money. The digital bank was found to have rejected over 1,000 fraud complaints in 2023 alone, with many of these cases dating back more than two years.
According to data from the Financial Ombudsman Service (FOS), Monzo's error rate is significantly higher than its rivals, with 34% of 3,372 cases referred to the FOS deemed incorrect. The bank's mistake rate surpasses that of NatWest and HSBC, with NatWest rejecting 33% of 1,972 fraud complaints and HSBC rejecting 32% of 2,535 complaints.
Monzo has claimed that some of these cases were linked to scams dating back two years or more. However, the bank's attempts to prevent future scams have apparently not been successful, as it was found to have allowed customers to register for accounts with "implausible" home addresses - including government buildings and its own headquarters - in 2022.
The FOS received hundreds of cases a week from people who had been victims of fraud and scams, with the organization saying that firms need to make reimbursement fair, fast and consistent, without forcing victims into a long fight for answers. Consumer rights organization Consumer Voice echoed this sentiment, stating that people who have been scammed often face further distress when trying to make a complaint against their bank.
The government has introduced new rules requiring banks to refund most victims of authorised push payment (APP) scams, with UK Finance reporting 185,733 APP cases in 2024. However, the industry still has a long way to go in preventing these types of scams, as fraudsters took £450.7m from their victims last year and only £267.1m was paid out in compensation.
Monzo's high error rate comes on top of its previous financial crime controls being fined £21m by regulators last summer. Despite this, the bank has continued to grow, tripling its customer base to over 14 million. However, its leadership changes have raised concerns about the bank's ability to address these issues.
According to data from the Financial Ombudsman Service (FOS), Monzo's error rate is significantly higher than its rivals, with 34% of 3,372 cases referred to the FOS deemed incorrect. The bank's mistake rate surpasses that of NatWest and HSBC, with NatWest rejecting 33% of 1,972 fraud complaints and HSBC rejecting 32% of 2,535 complaints.
Monzo has claimed that some of these cases were linked to scams dating back two years or more. However, the bank's attempts to prevent future scams have apparently not been successful, as it was found to have allowed customers to register for accounts with "implausible" home addresses - including government buildings and its own headquarters - in 2022.
The FOS received hundreds of cases a week from people who had been victims of fraud and scams, with the organization saying that firms need to make reimbursement fair, fast and consistent, without forcing victims into a long fight for answers. Consumer rights organization Consumer Voice echoed this sentiment, stating that people who have been scammed often face further distress when trying to make a complaint against their bank.
The government has introduced new rules requiring banks to refund most victims of authorised push payment (APP) scams, with UK Finance reporting 185,733 APP cases in 2024. However, the industry still has a long way to go in preventing these types of scams, as fraudsters took £450.7m from their victims last year and only £267.1m was paid out in compensation.
Monzo's high error rate comes on top of its previous financial crime controls being fined £21m by regulators last summer. Despite this, the bank has continued to grow, tripling its customer base to over 14 million. However, its leadership changes have raised concerns about the bank's ability to address these issues.
So I'm seriously worried about Monzo right now... like, how can a digital bank with all that tech and expertise still manage to mess up so many refund claims? 
It just doesn't add up. The fact that they've had over 1,000 fraud complaints rejected in 2023 alone is insane - and the FOS is saying that their error rate is way higher than everyone else's. That's gotta be fixed ASAP.
And now we're hearing about more cases where scammers are exploiting the system, taking money from innocent customers.
The government is introducing new rules, which is good, but it's also clear that the industry still has a long way to go. Until these issues are fixed, I'll be keeping a close eye on Monzo - and I hope they take action soon! 
. 1,000 fraud complaints just being rejected? that's crazy. I remember when I used to use online banking and if there was even a tiny mistake on my account they'd freeze my whole thing for hours it's like Monzo is playing with fire here. I hope the government gets their act together and makes these banks refund people ASAP or else we'll just have another wave of people getting screwed.
Their error rate is insane and it's not just about making mistakes, it's about people losing thousands of pounds because they can't get their refunds back on time. The fact that they've allowed customers to register for accounts with dodgy addresses in 2022 is just ridiculous. How hard is it to verify someone's address? 
It's not like these people are going to scam themselves out of money! 
Monzo is literally killing it with their customer service skills, right? 
I mean who needs a refund when you can just deal with some dodgy home addresses and hope for the best? 
And have you seen the figures? £450.7m taken from victims and only £267.1m paid out in compensation? Like, what even is the point of all these new rules if we're just going to keep getting scammed? 
consumer rights orgs r right, firms gotta be more responsible & fair 
1k cases rejected in 2023 alone and its not like natwest or hsbc are perfect either. seems like monzo is still figuring out how to deal with scams. their mistake rate is off the charts 
and theyre still growing which is sus
This news is a harsh reminder that we need to be vigilant and protect ourselves from scammers. I mean, think about it - if thousands of people got scammed out of their money, what does that say about our online security? 
So, let's all make sure to double-check those account details and be cautious when sharing personal info online! 
That's not a mistake, that's an intentional security breach! And don't even get me started on their error rate - it's like they're trying to make people struggle to get their money back. 
i mean what kinda bank doesn't verify their customers' info before letting them create an account? 
but we still need more action on this whole issue 
. And what's even more shocking is that customers were allowed to register for accounts with fake addresses, including government buildings and Monzo's own HQ - that's just basic security 
ugh i cant believe monzo scammed their own customers out of so much money and now theyre denying refunds 
. its not just about the financial losses, its about the emotional distress and stress victims go through when trying to get help from their bank or the ombudsman service 
. regulators need to take action and ensure these banks have better fraud prevention measures in place 
. monzo needs to step up their game and prioritize customer safety over profits 
they're supposed to be a digital bank that's all about security, not scamming people out of their money 
. The government introducing new rules is a good start, but like, what's taking them so long? 
how r they s'posed 2 recover from losin ur money if they can't even get their refunds back? 