Not upheld: unauthorized transaction claim and refund request complaint against Barclays Bank UK PLC

Decision detail

Summary

Mr Z purchased a flight for a friend on travel provider T for approximately £460 by entering card details and an OTP, believing this was necessary to obtain flight prices. After realizing his error, he contacted T and was assured of cancellation and refund by an agent named S, but T later denied having such an employee. Mr Z requested a refund from Barclays under Section 75 of the Consumer Credit Act 1974, which Barclays declined. The ombudsman found the transaction was authorized under PSR 2017 when Mr Z entered the OTP, and no Section 75 or chargeback claim was viable due to lack of evidence of misrepresentation and the non-refundable nature of the tickets. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Mr Z authorized the transaction by entering the OTP in accordance with the agreed procedure between him and Barclays under PSR 2017. The regulations apply an objective test of authorization that does not require the consumer to be fully aware of payment details. The ombudsman distinguished between 'consent' under PSR 2017 and 'informed consent' from other contexts, clarifying that the former does not require full explanation. No Section 75 claim was viable as there was no evidence of misrepresentation by the merchant (the ombudsman tested the website and found prices obtainable without entering card details) and no valid debtor-creditor-supplier relationship. A chargeback was not appropriate as the tickets were non-refundable and there was no merchant fault. The email from S, while potentially fraudulent, did not evidence S's involvement in the original transaction authorization.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website