Not upheld: failure to prevent financial harm from compulsive gambling spending and failure to recover payments through chargebacks complaint against MBNA Limited

Decision detail

Summary

Mr D complained that MBNA failed to offer appropriate support when he was experiencing financial harm due to compulsive spending on online casinos and failed to take action when he reported the payments. MBNA carried out chargebacks for some payments but declined to carry out further chargebacks, claiming the circumstances did not meet the relevant requirements. The ombudsman found that MBNA acted reasonably because: (1) intervention would likely not have prevented Mr D from making the payments, as evidenced by his responses when another bank intervened; (2) further chargebacks would not have been likely to succeed under chargeback scheme rules; and (3) there was insufficient evidence to support a claim under section 75 of the Consumer Credit Act. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman reasoned that while MBNA should have monitoring systems in place, intervention would not have prevented Mr D from making the payments because: (1) when another bank intervened and asked similar questions, Mr D stated he was managing his finances and declined support; (2) Mr D was entitled to use his account as he saw fit and had capacity to run it; (3) he would likely have continued making payments regardless of intervention. Regarding chargebacks, the ombudsman found that further chargebacks would not have been likely to succeed because: (1) the services were received and Mr D could withdraw winnings, so goods/services were not absent or defective; (2) even if merchant codes were incorrect, Mr D had no gambling freeze in place, so payments would not have been declined with correct codes; (3) there was insufficient evidence of breach of contract or misrepresentation that induced the contract under section 75.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website