eToro Money UK Ltd · DRN-6263492

The complaint Mr B complains that eToro Money UK Ltd (‘eToro’) hasn’t refunded the money he lost to an investment scam. What happened The circumstances of the complaint are well-known to both parties. So, I don’t intend to set these out in detail here. However, I’ll provide a brief summary of what’s happened. In January 2025, Mr B opened an account with eToro. He sent £5,000 to his eToro account from another of his banking providers. He moved £200 to eToro’s trading platform. The remaining £4,800 was sent to his own digital wallet with a cryptocurrency exchange, which I’ll refer to as ‘C’. Mr B says the funds that he sent to C were lost to a scam. When he discovered he’d been the victim of a scam, Mr B asked eToro to refund the money he’d lost. However, eToro said Mr B had authorised the payment to his own digital wallet with C and so it didn’t consider it was responsible for his loss. Unhappy with this outcome, Mr B referred a complaint to this service. Our Investigator considered the complaint and thought it should be partially upheld. They didn’t think eToro needed to refund Mr B’s loss from the scam. However, they did think eToro’s customer service had been poor and so they recommended eToro pay Mr B £100 compensation for the distress and inconvenience this had caused. Neither party accepted our Investigator’s opinion. As an informal agreement couldn’t be reached, the complaint was passed to me to decide. I reached the same outcome as our Investigator, but for different reasons. So, I issued a provisional decision and gave both parties an opportunity to provide any final submissions. As neither party accepted my provisional decision, I’m now issuing my final decision. 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 haven’t been provided with any further submissions from either party to consider. So, I see no reason to depart from my provisional decision, which I’ll reiterate below. “I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. 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.

-- 1 of 4 --

In broad terms, the starting position at law is that a firm, like eToro, is expected to process payments and withdrawals that a customer authorises, in accordance with the Payment Services Regulations (in this case, the 2017 regulations) and the terms and conditions of the customer’s account. Mr B has explained that as part of the scam, he downloaded screen sharing software on his mobile phone, so that the scammer could see what Mr B was looking at. This allowed the scammer to guide Mr B through the eToro account opening process and give instructions on how to make transactions on the eToro platform. However, the software Mr B installed doesn’t allow another user to control a mobile phone through remote access. So, whilst Mr B may have been following a third party’s instructions, I think he made the £4,800 payment to C. So, the starting position here is that the disputed payment was authorised, and Mr B is responsible for the payment (and the subsequent loss) despite it being made as the result of a scam. However, that’s not the end of the story. Good industry practice required eToro to be on the lookout for account activity or payments that were unusual or out of character to the extent that they might indicate a fraud risk. On spotting such a payment, I’d expect it to take steps to warn the customer about the risks of proceeding. Our Investigator didn’t think eToro reasonably ought to have been concerned when Mr B moved £4,800 from eToro to his digital wallet with C, but I disagree. Mr B opened his eToro account on 24 January 2025 and deposited £5,000 the same day. Despite eToro offering a digital wallet and cryptocurrency exchange service, Mr B then immediately moved £4,800 to a different cryptocurrency exchange, despite having just moved those funds into his eToro account. The payment was for a large amount and the transactional pattern suggested Mr B may have been using eToro as an intermediary account in order to facilitate the movement of funds to C, which was suspicious and indicative of multi-stage fraud. Whilst eToro didn’t have an account history to compare the £4,800 payment to (as the eToro account was brand new), there was enough evidence available to demonstrate the transaction had a heightened risk of fraud. In those circumstances, I’d have expected eToro to have asked some automated questions to understand why Mr B was making the payment, to ensure he wasn’t at risk of financial harm from fraud. This didn’t happen and Mr B was able to move the funds to C without any intervention from eToro. So, I’ve considered if it is more likely than not that Mr B would’ve acted differently in response to proportionate questioning from eToro. As explained above, Mr B had downloaded screensharing software, so the scammer would’ve been able to see any questions that were asked. Also, Mr B has confirmed that he followed the scammer’s instructions throughout. So, it seems likely that if eToro had asked any questions, Mr B would’ve sought advice or received instructions from the scammer on how to answer.

-- 2 of 4 --

I understand that the scammer asked Mr B to take out a large personal loan with another banking provider. Although Mr B was reluctant to do this, the scammer was able to persuade him to do this. I think this demonstrates that Mr B was under the scammer’s spell and suggests he would, most likely, have followed the scammer’s instructions when answering any questions from eToro, which would’ve likely prevented the scam being identified. As a result, I don’t think any questioning or scam advice from eToro would’ve resulted in Mr B deciding not to make the payment to C. The £4,800 Mr B sent from eToro went to his own digital wallet with C, which he’d opened around a month earlier. As the digital wallet with C was in Mr B’s own name, which he appears to have had control over, I wouldn’t have expected eToro to have attempted to recover any of those funds, as Mr B would’ve been able to do this without eToro’s assistance. So, I don’t think eToro missed an opportunity to mitigate Mr B’s loss. It would appear that Mr B still has funds in his eToro account and potentially in his digital wallet with C too. As the account and digital wallet are in Mr B’s own name, he will need to withdraw those funds himself. Once it was aware of the scam, I think eToro’s customer service could’ve been better. It took eToro an unreasonable length of time to respond to the scam claim and subsequent complaint. During that delay, Mr B frequently contacted eToro for updates and the responses were generic and unhelpful to him. I think this did cause unnecessary distress and inconvenience to Mr B and I think £100 compensation is a fair amount in recognition of the impact this had on him. In summary, I don’t think eToro reasonably could’ve prevented Mr B’s loss or done anything to recover his funds. However, I do think eToro caused avoidable distress and inconvenience to Mr B and should pay him £100 compensation in recognition of this.” I’m satisfied Mr B most likely authorised the disputed payment. Given the suspiciousness of the payment, eToro ought to have attempted to understand why Mr B was making the payment through automated questioning. But I don’t think eToro would’ve been able to prevent Mr B from making the payment to his digital wallet with C because he was being coached by the scammer. So, I don’t think eToro can reasonably be held responsible for the loss Mr B has suffered. There was also nothing eToro needed to do to attempt to recover Mr B’s payment in the circumstances. As a result, I’m not asking eToro to refund Mr B. eToro did cause Mr B unnecessary and avoidable distress and inconvenience through failings in how it dealt with Mr B’s scam claim and complaint. I previously recommended £100 compensation in recognition of the impact this had on Mr B and I remain of the opinion that eToro should pay this amount to fairly resolve the complaint. Putting things right In recognition of the impact of its poor customer service, eToro should pay Mr B £100 compensation. My final decision For the reasons explained above and in my provisional decision, I uphold this complaint in part.

-- 3 of 4 --

Under the rules of the Financial Ombudsman Service, I’m required to ask Mr B to accept or reject my decision before 28 April 2026. Liam Davies Ombudsman

-- 4 of 4 --