Upheld: Irresponsible claims handling / Failure to raise chargeback / Poor customer service complaint against ZILCH TECHNOLOGY LIMITED

Decision detail

Summary

Mr C purchased a defective electronic navigation device for a boat using his Z account in July 2025. After the supplier refused a refund, he asked Z to raise a chargeback dispute. Z declined, claiming insufficient information, despite Mr C providing detailed descriptions of the defects, troubleshooting attempts, and supplier correspondence. Mr C eventually recovered his money through a chargeback from Bank A and a court settlement with the supplier. The ombudsman found Z should have raised the chargeback as Mr C met the requirements of the relevant Mastercard rule, and that Z's poor customer service (requiring repeated information and impossible documentation) compounded the frustration and delay, particularly given the safety-critical nature of the equipment. Z was ordered to pay £300 compensation for distress and inconvenience.

The Ombudsman's reasoning

Z applied an unreasonably high standard by requiring 'confirmation' that a chargeback would succeed, when the proper standard is only that it should have a 'reasonable prospect of success'. Mr C had provided sufficient information to meet the chargeback rule requirements: a detailed description of the issue and a reasonably specific description of the goods. The fact that Bank A successfully raised a chargeback and the supplier subsequently settled a court claim demonstrates the chargeback would likely have succeeded. Z's failure to raise the chargeback, combined with poor customer service (requiring repeated information, requesting impossible documentation for an in-store purchase, and applying criteria not in the chargeback rules), caused Mr C unnecessary delay, stress, and the need to pursue alternative recovery methods. The safety-critical nature of the item compounded the urgency and anxiety.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website