Upheld: dispute handling, inadequate communication, delayed claim processing complaint against Clydesdale Bank Plc trading as Virgin Money

Decision detail

Summary

Mr M purchased a car using his Virgin Money credit card for £9,000 (plus £3,995 via other means) in June 2025. After discovering the car had various faults, he requested a refund in September 2025. Virgin Money initiated a chargeback process which took five months to resolve successfully, but failed to provide adequate information, respond to emails, or consider Section 75 remedies promptly. The ombudsman upheld the complaint, finding Virgin Money should have considered Section 75 liability concurrently with the chargeback once Mr M requested the full refund amount. Virgin Money was ordered to refund the £3,995 price difference and £55.32 diagnostic fee with interest, plus £200 additional compensation for the avoidable distress and inconvenience caused by its failures in communication and claim handling.

The Ombudsman's reasoning

Virgin Money was not unreasonable in initially raising a chargeback given strict timescales and the information Mr M provided. However, once Mr M clarified in early October 2025 that he wanted to claim the full amount, Virgin Money should have considered Section 75 liability concurrently with the chargeback rather than waiting for the chargeback outcome. Virgin Money failed to provide adequate information about the process, did not respond to emails, and delayed logging the Section 75 claim until February 2026. While the chargeback ultimately succeeded, Virgin Money could have better supported Mr M throughout and resolved matters sooner. The lack of communication caused avoidable distress to Mr M who was already experiencing difficulties.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website