chip and pin unauthorised transaction: help

pigeonpie

OH and I share a credit card with the same number. According to our latest credit card account, one of them was used a week ago in a convenience store in North London, many miles from where we live, to the tune of £64-odd. The bank disputed transaction people say it's a chip and pin transaction where one of us and the card has to be physically present and the PIN entered. Neither OH nor I have been near North London for years and I promise that the transaction is either fraudulent (in which case: how did they manage it?) or a mistake by the bank in that another customer did that shopping. The bank people say it is impossible with their computer system to confuse customers' transactions. (hmm?).

They have raised a dispute but are not worried as the card has not been fraudulently used again. They gave me the no of a convenience store in the same road who I called and who tell me that there is indeed an asian convenience store by that name nearby. (I can't find their no on the internet though).

The bank suggest that it may be someone else 'trading as' this convenience store but it isn't. OH and I keep all our slips and we did not spend this amount anywhere last week. The bank are investigating but are strongly suggesting that if it shows up on the paperwork as indeed a chip and pin transaction, that we will be liable to pay the £64 as they can't claim it back.

What are my rights and what should I do to avoid paying money we didn't spend?

CLAPTON

ask them for evidence that it was a chip and pin transaction... there have been occasionals when they accidentally mis informed the CC holder and really it was a signature.

Alex_LS

The fact that it's a Chip & PIN transaction does not mean they can't claim it back. It just means that the merchant is not automatically liable. According to the rules, they have to prove that you were negligent with your PIN (or directly involved with any fraud).

Mandark

This is a worry. A bank genuinely having full confidence in their system. Who are they kidding?!!

They probably think one of you has been secretly using the card without telling the other. Ask the bank for evidence as Clapton says.

ALIBOBSY

Have they cancelled your cards for new ones?
I would worry that sometimes card fraud starts as a small transaction, before they go for the big amount.

ali x

James

I’m very sorry to learn what’s happened to you. There is good news and there is bad news.

First the good news. Under the Banking Code (which is due to be superseded 1 November by the Pay Services Regulations) article 12.12 states your bank has to show you’ve acted fraudulently or without reasonable care, otherwise the most you should be liable for is £50.

The bad news is that more and more banks are rejecting legitimate claims from victims of PIN based fraud. Basically card issuers are shifting the liability for fraud onto the card holder.

What should you do next:

Keep a record of who you’ve spoke to and when. Send all mail recorded.

1. Contact the Police and report the fraud to them. Tell them your card issuer is claiming you’ve been careless with your PIN. Make sure you don’t leave the Police Station without a crime reference or incidence number. This also suggests to your card issuer that you’ve not committed first party fraud.


2. When you’ve reported this to the Police write to your card issuer stating that you’ve never divulged your PIN to anyone (including your OH), and you’ve been careful with it at all times. Tell your card issuer you’ve reported this to the Police and give them the crime reference or incidence number. Ask them for your money back and state if they fail to reimburse you forthwith, you will go down the Financial Ombudsman route.

You may like to read, or even contact Stephen Mason who is looking for examples of cases just like yours. (Click here). BBC’s Money Box are covering this very topic this coming Saturday I believe. It may also be worthwhile contacting them.

The bad news is confirmed in this recent article in the Times (Click here), and by BBC’s Watchdog (click here) quite some time ago now.

Let this be another warning to Chip & PIN Credit Cardholders. Get yourself Chip & Signature Cards and this situation will never arise. Why chance it?

Good luck.

pigeonpie

is a chip and signature card an option offered by all banks or just a few? Is it the same as the old days when you had to sign (also open to fraud). The bank have cancelled our cards. They didn't want to because 1. they thought it really was us and 2. if it wasn't and was a fraudster, then why did they only buy £63 of groceries at an asian supermarket? ie they clone cards and copy PINs and that's what they do.
It is a bit odd unless they are planning to use it again. That's why I wondered if the wrong customer had been charged.
Anyhow from what you say, we may be liable for £50 of the money we didn't spend? Last year someone bought laptops on my card via telephone - they got my address slightly wrong so the bank called me - and the police could not have been less interested. Which is half the problem imho.

James

Chip & Signature:

“Under the Banking Code, all banks must offer a “chip-and-signature” account for those who may find it difficult to remember their PIN, or cannot use a chip-and-PIN terminal. However, Times Money has discovered that some banks are reluctant to tell customers of this alternative method.” The Times 10 Oct 2009

I should have suggested that you include the following question.

As it wasn’t me who carried out this transaction can you explain in writing how this crime was perpetrated? Was the transaction PIN or signature authenticated?

Although the Police seem disinterested, it’s still important you get an incidence or crime reference number. Contact your MP on this point too, and let your local nick know you’ve done this. Point out to your MP/Police that your card issuer is suggesting you are implicated in this fraudulent transaction and you want to clear your good name.

Re the £50 you could be liable for. I’d be surprised if anyone has actually fallen foul of this charge. I certainly haven’t heard of anyone.

Best I can do.

Good luck.