Mastercard Chargeback Time Limits

DavetheDave

This post is a bit long but I felt it was best to state as much information as possible from the start.

The short version of this post is that my Mastercard credit card provider will not action a chargeback for me on two fraudulent transactions that occurred in October 2008, which appeared on my November 2008 statement and which I reported to them in November 2008.

Here's all the information:

In November 2008 I discovered two transactions on my Mastercard credit card statement (dated November 2008) which I did not make and were therefore fraudulent.

I telephoned my credit card provider in November 2008 to resolve this issue and they advised me to contact the merchant. They didn't suggest cancelling the card at this point, they did not advise me about the chargeback process and they didn't advise me of any time limits.

The merchant advised in December 2008 me that there was nothing they could do as they had sent the items to my address (however I did not receive these items).

I then contacted my credit card provider in February 2009 and got all call back from the Disputes department informing me it was now too late to resolve the issue. While I accept that I could have contacted my credit card provider sooner, as I had not been made aware of any time limits and I had already advised them of the issue, I did not think I would run out of time.

As I was surprised by this and didn't get a full explanation from this call, the next day I contacted my credit card provider again. I was put through to the Disputes department and the person I spoke to claimed the time limit was 180 days and this was explained in my terms and conditions (I have checked and there is no mention of time limits nor chargeback).

I then spoke to a manager who told me that I was out of time but she couldn't tell me when my time had run out. This I take to be an indication she didn't know what the time limit was. When I mentioned that the person I had just spoken to told me it was 180 days, she told me that they shouldn't have told me that. Staff are told not to give time limit information.

I explained to both of these customer representatives that I had called in November 2008 but they told me there was no record of my call in November 2008.

I was also told by the same manager that the transactions were not fraudulent. She was suggesting I had made them and had forgotten them.

This conversation did not resolve anything. I then tried to call the Fraud department. However, this just resulted in me being put through to the original person I spoke to at the beginning of this set of calls.

I then found out about chargeback and the 120 day limit. I also read that my provider have been exposed as having limited knowledge of chargeback (which probably explains why I wasn't advised of this in November 2008). So I called them again.

This time the manager I spoke to informed me that the 120 day limit starts from the day the transaction occurred (in this case, October 2008 - as opposed to when I was first aware of the transaction - i.e when I received my statement in November 2008). By her calculation, I was out of time by 8 days. However, I reminded her that I had originally called in November 2008. She then told me I shouldn't have waited so long to chase them and that it was my fault. She told me they don't advise customers to chase them as they expect customers to do it themselves.

So my questions are as follows:

1. How can I prove that I called them in November 2008?

2. When does the Mastercard Chargeback time limit begin? There is a lot of information on this site about Chargeback, but it all seems to refer to Visa not Mastercard. It seems strange to me that the time limit can begin before the customer is even aware that a transaction has taken place (i.e if a transaction takes place just after a statement is printed, it could be a month before the customer receives their statement and is aware of the transaction).

3. Is there a time limit on resolving chargeback claims? If I can prove I called them about this issue in November 2008, can they argue that the chargeback should have been resolved in the 120 days?

4. Is it fair to expect a customer to know of time limits when it appears their staff are unaware of them and there is no mention of them in their terms and conditions?

5. Should a Mastercard Chargeback been raised in November 2008 when I originally called? Is this negligence on their part that they didn't inform me of this option nor provide me with any paperwork to complete?

I have contacted the Financial Ombudsman with regard to my case. On their website there is a case of a man who was not informed of the time limits and the Financial Ombudsman ruled that because he had not been advised of the time limits, he was not bound by them. So I am quite hopeful. Thank you for reading and for any advise you offer me.

normanmark

First off, its not fraudulent transactions merely based upon the merchant sending them to your address, that would be the giveaway.

Secondly, which credit card company is this with?

In answer to your questions:

1. Your phone bill?
2. From the date of the transaction
3. If you can prove it then yes I would say they could open it. Any claim of dispute needs to have a form signed with your signature. So it might be difficult to try to prove that.
4. They will have some documentation of what happens with disputed transactions
5. You need to have the proof again that you've called to declare disputed transactions.

Pointless contacting the financial ombudsman, you need to exhaust the complaints procedure of the card company. I recognise the point of not being told of time limits, but i'd say that if prompted the card company would come back with some leaflet advising of the terms & conditions.

DavetheDave

Thank you for your reply.

I hope you don’t think I am being rude with this question, but why do these transactions not count as if not fraudulent, as I did not make the transactions and no one else has access to the card? If I didn't make the transactions, someone else must have and therefore that is fraud isn't it? I didn't receive the items despite the merchant saying they were sent to my address. I may not have made it clear, but the transactions were with an on-line company and therefore was cardholder not present.

Also, when I reported this back in November, how would they have known where the items had been dispatched to (as I didn't make the transactions and therefore had no idea what they were for)? Based on this, why wasn't it raised as potential fraud at that time?

The merchant was an on-line store and as part of my investigation into what the transactions were for, I tried to log in to their on-line store to see if I could see any orders under my account. They used email addresses as the log in ID and my only email address was not registered. So there is no way I made the transactions and yet some how they occurred.

Also on my statement there shows a transaction for something else that was reversed three days later (this was another transaction I did not make but it was reversed and as I have not lost that money, it wasn't a priority to raise it with them).

Another interesting point is that the statement has two different dates for both of these transactions (the Date of Trans and the Date Entered). The Date of Trans for the two transactions in question were a day apart and for the same amount, but the Date Entered date for the first one was three days after the Date of Trans date and the Date Entered date for the second one was 12 days after the Date of Trans. What is the difference between these types of date?

To answer you question, the credit card company is Bank of Scotland. I have checked their terms and conditions on their website and there is no mention of chargeback nor of time limits for fraud. On my statements it says "...if someone uses your card or card details fraudulently you will not be liable…". Also, to repeat one of my questions, how can they expect their customers to know about terms and conditions which their own staff appear to be unaware of?

Will my phone bill be sufficient proof? Can't they argue that it is just proof I called but not what about I called about? I am very concerned that my call was not logged when I rang in November, as it appears that the issue is with the number of days that have passed since this all began. When I raised it originally, it had not been long, but as they claim to have no record of that they are arguing the time limit has expired.

If a form is required for a claim of dispute, why did they not send me one when I raised the issue? They only advised me to contact the merchant, which seemed strange to me as I had not made the transactions.

I believe I have exhausted the complaints procedure of the card company. I have made a complaint to their complaints department and I through the Financial Ombudsman I have made a written complaint to them. I appreciate I may have to wait eight weeks for their reply before the Financial Ombudsman will get involved any further.

normanmark

Well the fact your address is tagged onto the order is enough for the card company to not deal with it as a fraudulent transactions, if it was someone using the card fraudulently then surely they would send the goods to a different address as there would be no point in committing the fraud (they're not gaining anything). That's why they would treat it as a dispute.

The ombudsman will only get involved when the credit card company declares it as a state of 'deadlock' and then advise for you to contact the ombudsman.

As for the terms & conditions of the dispute, from a bit more digging around it seems that its a limit of 120 set by Mastercard themselves.

What you need to do now is to write a letter outlining the points, ask them to go through their phone records on the date you said you phoned and ask them to bring up the recorded call (that will tell you precisely whats happened). Also ask what they can do with regards to the day limits set by Mastercard, however don't go in two feet without them confirming what was said on your original call in November. The reason i say that is that if nothing was said on that call, then they'll pass it back to you & say well you didn't raise anything in the 120 days.

DavetheDave

Thank you for your update.

I hope you don't mind, but I am still confused about how the credit card company would know whether or not it was a fraudulent transaction at the time it was raised. While I accept their opinion of what constitutes fraud may differ from mine, when I raised the query, how could they known what delivery address the transactions related to? Do the merchants have to provide the delivery address to the credit card provider as part of the transaction process (I presume they have to provide the billing address)? If they did know, surely they could have told me at the time and I could had told them at that time that in addition to me not ordering the items, I had not received the items either.

However, they told me to contact the merchant and it was only after I did this that I was informed by the merchant that they had sent the items to my address. This is despite the fact that I did not receive the items.

So, while I disagree with the fact they call it a dispute, how could they call it a dispute when I raised the call I told them there were transactions on my account not made by me. Surely they should have treated it as fraud at that point? The only information they would have at that time, was that I had become aware of transactions I hadn't made.

Given the scenario that a customer calls and says they did not authorise transactions which have been made on a company's website (the transactions were listed as ****.co.uk), why would the credit card provider treat it as a dispute from the start? This seems a little strange to me.

Thank you for the advice with regard to the Financial Ombudsman. I appreciate that step is some way off yet.

I also found that information about Mastercard. My confusion is that if you ordered a flight in July that departed in December and the company went bust before December (say November), shouldn't the 120 day limit start from the time the company went bust (i.e November), otherwise wouldn't the 120 day limit would be pointless? According to information I have gathered from here, with Visa Chargeback, the 120 day limit begins when you are first aware there is a problem with the transaction. Why is Mastercard's approach different? Is their protection less than Visa's?

Also, from what I understand of the Mastercard regulations (and I accept I may not be reading them correctly), if a customer advises of a suspected fraudulent transaction, a chargeback should be raised while the situation is investigated.

From what I can tell from the Mastercard regulations (and the reason for my posting is to try and get a better understanding), my credit card provider should have immediately raised a chargeback when I raised the issue as suspected fraud. However they didn't and instead treated my case as dispute (despite the fact that I told them I had not made the transactions and therefore wasn't disputing anything in relation to what had been ordered e.g the quality or delivery date). If they had done this, there would have been a record and this whole matter would have hopefully been resolved months ago.

Also, shouldn't my credit card provider provide me with a full set of terms and conditions which includes the terms and conditions of Mastercard? Shouldn't they also provide me with an outline of time limits when I call?

Thank you for all your advice. I will contact my credit card company with regard to their phone records, but I don't believe the department I called records their phone calls. When I called the complaints line I was advised the call would be recorded, but calling the customer services line does not advise you that your call may be recorded. However, they still might record them, but as they have not offered to investigate my call for November, I am not overly hopeful.

From the start of this whole issue they have not provided me with much information and they do not appear to know Mastercard's terms and conditions themselves, otherwise I would presume they would have been able to tell me about the time limit when I spoke to them both in November and again this year.

Once again, thank you for taking the time to provide me with all the advice you have given me. However, I don't hold a lot of hope of resolving this issue with my credit card provider. They have failed to provide me with key information at various stages, they have treated my issue as a dispute when I raised it as a fraudulent transaction and they appear to have either not recorded or lost the record of my original call.

dazza.mk

DavetheDave wrote: »

My confusion is that if you ordered a flight in July that departed in December and the company went bust before December (say November), shouldn't the 120 day limit start from the time the company went bust (i.e November), otherwise wouldn't the 120 day limit would be pointless?

In this instance you wouldn't be relying on Mastercards chargeback rules, rather you would be relying on the Consumer Credit Act Section 75 protection and holding the credit card company jointly liable for not providing the service. However this isn't applicable in this case as (presumably) the retailer has delivered what was paid for, rather your disputing the validity of the transaction itself.

If you have not already done so raise it as a 'complaint' via the companies complaints procedure (in order to start the ball rolling to take the issue to the ombudsman)

DavetheDave

Thank you for your reply.

Section 75 protection only protects you if the price of the item is between £100 and £30,000 (as I understand it). If you were to buy a flight for less than £100, then Section 75 wouldn't apply and so you would only be able to use the Mastercard chargeback system. However, if the time limit starts when the transaction takes place, this time limit would expire before you knew there was a problem.

As you say, this doesn't apply in my case because the amount is below that required by Section 75. However, just to clarify, not only did I not make the transactions in question, in addition to this, I did not receive the items that the transactions relate to.

I have made a complaint to the credit card company's complaints department, not only because of how they've handle this case but also because of how I have been treated by the staff. For instance, I don't think it's right for a customer advisor to refuse to tell me of a time limit when I asked what the time limit is as a direct question. When I asked them what the time limit was that had apparently expired, she refused to tell me and just kept repeating that it had expired. I take this an indication they weren't actually sure what the time limit was themselves, so how can they expect me to know?

I have also raised a complaint to them via the Financial Ombudsman. I believe the next stage is to wait for the credit card company's reply to my complaints and if they do not resolve the issue to my satisfaction, escalate it to the Financial Ombudsman.

dazza.mk

Simply the Mastercard chargebacks you refer to (above and beyond Section 75) are purely meant to deal with Fraudulent transactions they are not meant to deal with cases where the other firm has failed to deliver / gone bankrupt. The 120 days is therefore supposed to be time for you to notice and report the charges.

I realise you in fact did the above, so therefore your issue is that the bank failed to deal with the initial report correctly rather than the 120 days Mastercard deadline (in my view)

DavetheDave

My understanding (which is based on researching Mastercard's chargeback documentation) is that chargeback can be used whenever there is a dispute between the customer and the merchant. There are various different reason codes, covering fraud, damaged goods and goods not arriving to name just a few.

As I raised the issue in November, my credit card provider should have raised the chargeback at that point (so I agree with you that one issue is with their failure to deal with the issue correctly at the point). Had they actioned that at the time, everything would be in the time limit.

As they failed to do that and failed to inform me that a chargeback was possible and that there was a time limit, I wasted my time and effort contacting the merchant to no avail. Then when I got back them they merely informed me that it was too late, but were not able to tell me when it became too late. As I've mentioned, I suspect this is because they were unaware themselves.

The next day I spoke to someone else who said that the time limit begins when the transaction occurs and that as my second enquiry falls outside of that time limit, they will not action the chargeback (this person appeared to know more about chargeback than the two people I spoke to the day before, but this was only after I requested to speak to someone about chargeback). I find this strange, as the advice I have seen on this site suggests that chargeback time limits begin when you become aware of the problem. Either this is only the case with Visa chargeback or I have been incorrectly informed about Mastercard chargeback or the Visa chargeback actually begins when the transaction occurs.

It's worth bearing in mind that the time limit on chargeback may be shorter than it appears. If anyone can confirm that either (a) there is a difference between Mastercard chargeback and Visa chargeback or (b) if there is no difference between them, when the time limit actually begins (i.e transaction date or customer aware of the issue date), that would be a great help. Thanks in advance.