Merchant's breach of the card scheme rules

daryus

GoldenJill,
Thanks, I am!!

withnell

Did you ever contact the merchant direct and inform them that you did not order the service?

daryus

I have a letter, dated 7 weeks after the fraud occured, in which their own bank informed them that it was a fraudulent transaction. The title of this letter is "AUTHORITY NOT GIVEN - DISPUTED TRANSACTION". After advising the merchant to improve their security with "Card Security Code and Address Verification Service (CV2/AVS)...to avoid chargebacks", their bank stated: "In the circumstances, we must debit the disputed amount to your Merchant Service Charge Account"

LinasPilibaitisisbatman

My scenario:

1. I am the credit card holder.
2. A fraudster used my Visa credit card details to make an online purchase costing £963.35 for a domain name and web hosting.
3. Three days later, I realised that the fraud had been committed and reported it to my bank.
4. Amazingly, my bank let this transaction go through even though it took me £790.60 over my credit limit!!! Why did they not phone me for authorisation? Was the bank allowed to do this? Yes. Banks allow cards to go over their limit depending on the customer history
5. Also, the transaction was completed without using the 3 security digits on the back of the card nor address verification (CV2/AVS). Was the bank allowed to do this? how do you know that CVV/AV did not exist? if they didnt have your address how were you later tracked down and served?
6. Six working days after the fraud, the bank credited me the £963.35 (via the chargeback process).
7. 3 weeks later, I signed and returned a fraud declaration form.
8. 2 months later after the fraud, the merchant was advised by their bank that they were liable for the chargeback.
9. The merchant then circumvented/breached the card scheme rules and attempted to get payment from me directly (even though I am sure that ALL credit card disputes must be resolved through the chargeback process). No they didnt circumvent the process. They obviously believed that it was a scam to get out of payment and decided to use the court process to enforce what they believed was a valid contract. the merchant scheme is not a way to invalidate contracts.
10. After no success, they issued court proceedings against me.
11. I was advised by my bank not to respond to the courts nor attend court. I am astounded the bank told you this. Do you have this in writing? The bank were only involved in regards to a chargeback. Not any contract formed.
12. The merchant won, by default, and I got a CCJ issued against me.
13. My bank then told me they would fix the problem and they dictated the letter to me which I sent to them by recorded delivery. Tbh you shouldnt have been listening to the bank and sought legal advice
14. 2 years later, I was refused 2 credit card applications so I checked my credit file and, then, realised that the bank had not removed the CCJ.
15. I, then, regularly corresponded with my bank and the merchant's Solicitor for a further 5 months.
16. The merchant then issued a bankruptcy order.
17. I applied to have both the CCJ and the bankruptcy order set aside.
18. At court, I informed the Judge that it was credit card fraud, I reported it my bank they credited me the money back.
19. Amazingly, I lost the case.
20. I appealed and this time went to court with a barrister but, again, lost the case. I do not believe that he handled the case properly. Why did you lose the case? Tbh I can see why this happened and you should have been more proactive as an individual and defended the original case or contact the merchant yourself at day 1 when served and told them it was fraud. Instead 2 years down the line it looks dodgy
21. More recently, the merchant issued another bankruptcy order which was inclusive of the original amount £963.35 and all of their costs (Total:£7866.94).
22. I applied to have the bankruptcy order set aside.
23. They did not attend court and therefore lost by default.
24. I still have the CCJ outstanding.

Who is responsible for taking action against the merchant's breach of the card scheme rules?
How can I fix this mess?




Tbh I think there are two seperate issues here. One the credit card fraud and two the contract formed for a service in your name.

The Merchant hasnt breached the card scheme that I can see. They issued the chargeback and complied. However believing the contract was valid chased you for payment in another way. Why is it they dont believe you? why dont the courts believe you?

There has to be more to this. You need to seek legal advice and get a solicitor to help you prove and get the company accept this was a fraudulent transaction. Once you do that the rest should be a formality.

You were naive in dealing with this and shouldnt have followed the banks instructions re ignoring the court etc as that was entirely seperate.

As for the card scheme itself. Its incredibly complex and I dont think you will even find many solicitors who understand it properly. The banks themselves often don't.

daryus

As far as I can see, this should now be fairly straight-forward.
Regulation 21 of the Distance Selling Regulations in line with the card scheme rules will sort this out.

RobertoMoir

daryus wrote: »

RobertoMoir,
This has been going on now for over 5 years. Hopefully, by the end of this thread, I can help others to avoid going through similar distress.
Both mine and my opponents legal teams have made "mistakes" which I will be addressing this week.

5 years? What an awful distressing ordeal it must be to be stuck with this situation for that long.

LinasPilibaitisisbatman

DSR's would assume a valid contract had been formed though. You cant invoke DSR's on fraudulent purchases.

And the scheme cover's the credit card. Not the overall contract formed.

daryus

RobertoMoir,
Indeed, I've had a CCJ for almost 5 years which has affected me substantially. In fact, I only discovered that my bank hadn't removed the CCJ when I had 2 credit card applications declined 2 years later.

LinasPilibaitisisbatman

Why would your bank remove a CCJ totally unrelated to them.

You have been very poorly advised at best.

daryus

LinasPilibaitisisbatman wrote: »

Why would your bank remove a CCJ totally unrelated to them.

You have been very poorly advised at best.

I have been very badly advised and, interestingly, my letter sent recorded delivery subsequently went missing.
Apparently, none of my conversations regarding this fraud were recorded, not even when I first reported it and they cancelled my card.
The 2 DSARs that I have requested had no record of me reporting the fraud even though they credited me the full amount 8 days later.