In recent years, the legal profession has witnessed a surge in cases involving Authorised Push Payment (APP) fraud. These cases often revolve around the question of whether banks owe a duty to their customers to prevent transactions they suspect to be fraudulent. The Court of Appeal’s decision in Philipp v Barclays Bank UK Plc [2022] EWCA Civ 318 that it was “at least possible in principle that a relevant duty of care could arise in the case of a customer instructing their bank to make a payment when that customer is the victim of APP fraud” created some hope for those seeking help clients recover funds lost to APP fraud.
However, the Supreme Court’s decision now makes a successful APP fraud claim much less likely.
Background of the Case
In 2018, Mrs. Fiona Philipp and her husband, Dr. Robin Philipp, became victims of a sophisticated fraud scheme. Deceived by criminals, they instructed Barclays Bank to transfer £700,000 to bank accounts in the United Arab Emirates (UAE).
The money was lost. Mrs. Philipp initiated legal proceedings against Barclays, contending that the bank had a duty, either under its contract with her or at common law, not to execute her payment instructions if it had reasonable grounds to believe she was being defrauded.
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