Not upheld: failure to provide adequate support to vulnerable customer with gambling addiction; limitations of gambling transaction blocks complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr H complained to HSBC after disclosing a gambling addiction and requesting a gambling transaction block, only to find that gambling-related transactions continued to be processed on his credit card in September 2025. HSBC explained that the transactions were coded under different merchant category codes (MCCs) rather than gambling MCCs, so they were not captured by the gambling block. Mr H argued HSBC should have provided additional support given his known vulnerability, including broader restrictions and escalation to specialist teams. The ombudsman found that HSBC correctly applied the requested gambling block, explained its limitations, signposted external support services, and acted reasonably in not imposing wider restrictions without a specific request from Mr H. The ombudsman concluded that the transactions bypassing the block were due to merchants using incorrect MCCs, not HSBC error, and that HSBC had balanced its duty to account for vulnerability against Mr H's ability to use his account and make his own financial decisions.

The Ombudsman's reasoning

The ombudsman found that gambling blocks work by identifying merchant category codes (MCCs) and have inherent limitations when merchants use incorrect codes. HSBC correctly applied the gambling block Mr H requested and explained its limitations. The transactions that went through were not coded as gambling transactions, so they were not captured by the block. This was not an error by HSBC but rather merchants circumventing the system by using incorrect MCCs. While Mr H was a vulnerable customer, HSBC responded appropriately by applying the requested controls, explaining limitations, and signposting support services. The ombudsman found no evidence that Mr H contacted HSBC between July and September 2025 to indicate the block wasn't working or to request additional restrictions. Fraud alerts alone did not reasonably require further action, as they were designed to identify unauthorised use rather than gambling-related harm. The ombudsman balanced HSBC's duty to account for known vulnerabilities against the customer's ability to continue using their account and making their own financial decisions, concluding that wider restrictions without a specific request would not have been appropriate or proportionate given the mixed nature of account usage.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website