Not upheld: Card / payment disputes complaint against ZILCH TECHNOLOGY LIMITED

Decision detail

Summary

Mr J used his Z account to pay an airline for excess baggage after a travel platform's booking system failed to allow him to add baggage online. He raised a dispute with Z claiming merchant misrepresentation by the travel platform, but Z declined to proceed with a chargeback and continued to pursue payment, sending late payment reminders and blocking his account. Mr J complained that Z should not have pursued him for the disputed amount while the chargeback was pending. The ombudsman found the chargeback had no reasonable prospect of success because Mr J's dispute was against the travel platform but his payment was to the airline, which had supplied the service as described. Z was therefore entitled to continue collection activities and report the missed payment to credit files. Additional complaints about lack of forbearance during Mr J's financial difficulties were deemed to fall outside the scope of the original complaint.

The Ombudsman's reasoning

The ombudsman concluded that the chargeback had no reasonable prospect of success because: (1) Mr J's dispute was against B (the travel platform) but the payment was made to A (the airline), and A had supplied the baggage as described; (2) the chargeback reason code for misrepresentation did not fit the circumstances since Mr J could not book baggage with B and therefore could not claim a service from B was not as described; (3) Z was therefore not obligated to temporarily re-credit the amount or suspend collection activities. The ombudsman found Z was entitled to send payment reminders and report missed payments to credit files in accordance with its terms and regulatory requirements. Additional complaints about forbearance and collection practices were deemed to fall outside the scope of the original complaint and should be pursued separately.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website