Section 75 vs Chargeback

theJBP

Ok I need help.

On the 28th November I ordered a playstation 4 console, costing £299.00 from a company called 247 Electronics. I paid on my Tesco Bank Visa Credit Card. 247 Electronics appears now to have gone bust - no one has received their orders, twitter, Facebook and consumer forums are up in arms with consumers complaining, and the company posted a message on it’s website saying it was unable to meet the orders and promised to refund everyone. Despite repeated attempts to contact the company I have been unable to secure a refund.

And so I contacted Tesco Bank and asked to make a claim under Section 75 of the Consumer Credit Act. They are refusing to let me do so. Instead, they are insisting I make a claim under their chargeback procedures.

My understanding is that Chargeback offers a much lower level of protection to the consumer. I am now really worried that they are insisting that I go down this route in order to give themselves greater scope to reject my claim.

Can I ask whether they are able to do this, or whether I can insist that they consider my claim under Section 75?

Tesco say Chargeback procedures are quicker and thus if successful I will see my money sooner. Should I go along with Chargeback? If I do and they reject me, does that in any way hinder me claiming under Section 75 later?

I'm really worried about this so any help any of you can give me with this will be greatly appreciated.

Thank in advance


theJBP

Armorica

http://www.moneysavingexpert.com/shopping/visa-mastercard-chargeback is a good guide.

My understanding (but useful if others can opine too!) is that claiming under chargeback (which is part of the credit card rules) unsuccessfully doesn't necessarily affect your statutory rights under section 75.

I'm not sure they can actually refuse to raise under s75 unless the criteria aren't met.

Both types can be put through the ombudsman if necessary.

Crabman

Chargeback means the refund comes directly from 247 Electronics.

Section 75 involves Tesco paying you as they are jointly and severally liable. Tesco will be entitled to claim their damages from 247 Electronics but this may not work out in their favour or they may not bother.

As for timescales, if Tesco drag it out, as most credit providers do, it could be many months as the ombudsman service is not the most efficient organisation in the world (doesn't help that they hide incompetence behind "independence" but that's a different matter).

I would go with the chargeback, but note in your own records what Tesco have said about the Section 75 as it may be useful at a later stage. They should really allow you to take either option as you are entitled to choose.

daveoc22

I had reason to phone Tesco on Friday and exactly the same happened to me, they refused to go down the section 75 route and insisted on chargeback.


I huffed and puffed but, other than agreeing to note my request on their records, they stood firm on chargeback.


I suspect that legally they should do what I asked, but there's not much you can do when they say no on the phone.


I will wait and see how the chargeback progresses but the bottom line is if I don't get my money from the shop then I will have to fall back on section 75.

meer53

A simple chargeback for non receipt of goods will result in a refund far quicker than Section 75.

Voyager2002

Most posters have advised you to go down the chargeback route...

FWIW my own experience earlier this year, when a supplier suddenly failed, was that chargeback (via Barclaycard) was quick and satisfactory.

antrobus

From the Google cache of 247electronics.co.uk

Due to unexpected traffic we received during Black Friday, we faced a number of technical issues, namely being unable to login to our admin section to place a limit on the orders and update stock quantities. By the time we regained access to our backend admin section on Saturday, we had received and processed payments of around 3000 orders while holding stock for around 400 units of PS4 and Xbox One consoles. Over the weekend we placed an order for 5000 units of consoles from our supplier and at this moment in time, we have not received an estimated time of delivery.

We have decided to withhold fulfilment of orders of units that we have in stock due to:

- Notifications of cancellations, as the order was ready to despatch.
- Paypal limiting and freezing our account.
- Termination notices and withholding of funds due to us from our credit card processors.

We would like to offer our sincere apologies to our customers for being unable to fulfil their orders. We have instructed PayPal and our card processor to refund all orders placed after midday Thursday the 27th of November. We would also advise that you open a dispute with PayPal and/or your credit/debit card issuer, which we would not challenge.

We understand our customer service has being unsatisfactory. Our 4 staff were overwhelmed with the amount of calls we received, numbering a few hundred a day and up to 150 emails an hour.

We hope that that you receive your funds in a timely manner, and again apologise for any disruption to your Christmas shopping. Our site will return in the new year, once we are certain all outstanding issues have been resolved.

Atidi

theJBP wrote: »

Ok I need help.

On the 28th November I ordered a playstation 4 console, costing £299.00 from a company called 247 Electronics. I paid on my Tesco Bank Visa Credit Card. 247 Electronics appears now to have gone bust - no one has received their orders, twitter, Facebook and consumer forums are up in arms with consumers complaining, and the company posted a message on it’s website saying it was unable to meet the orders and promised to refund everyone. Despite repeated attempts to contact the company I have been unable to secure a refund.

And so I contacted Tesco Bank and asked to make a claim under Section 75 of the Consumer Credit Act. They are refusing to let me do so. Instead, they are insisting I make a claim under their chargeback procedures.

My understanding is that Chargeback offers a much lower level of protection to the consumer. I am now really worried that they are insisting that I go down this route in order to give themselves greater scope to reject my claim.

Can I ask whether they are able to do this, or whether I can insist that they consider my claim under Section 75?

Tesco say Chargeback procedures are quicker and thus if successful I will see my money sooner. Should I go along with Chargeback? If I do and they reject me, does that in any way hinder me claiming under Section 75 later?

I'm really worried about this so any help any of you can give me with this will be greatly appreciated.

Thank in advance


theJBP

What makes you think they have gone bust?

They have, however, eperienced some recent problems. This was recently posted on their website (which appears to be down at present)

To all our customers

This information is intended to keep you up-to-date with your orders.

Due to unexpected traffic we received during Black Friday, we faced a number of technical issues, namely being unable to login to our admin section to place a limit on the orders and update stock quantities. By the time we regained access to our backend admin section on Saturday, we had received and processed payments of around 3000 orders while holding stock for around 400 units of PS4 and Xbox One consoles. Over the weekend we placed an order for 5000 units of consoles from our supplier and at this moment in time, we have not received an estimated time of delivery.

We have decided to withhold fulfilment of orders of units that we have in stock due to:
- Notifications of cancellations, as the order was ready to despatch.
- Paypal limiting and freezing our account.
- Termination notices and withholding of funds due to us from our credit card processors.

We would like to offer our sincere apologies to our customers for being unable to fulfil their orders. We have instructed PayPal and our card processor to refund all orders placed after midday Thursday the 27th of November. We would also advise that you open a dispute with PayPal and/or your credit/debit card issuer, which we would not challenge.

We understand our customer service has being unsatisfactory. Our 4 staff were overwhelmed with the amount of calls we received, numbering a few hundred a day and up to 150 emails an hour.

We hope that that you receive your funds in a timely manner, and again apologise for any disruption to your Christmas shopping. Our site will return in the new year, once we are certain all outstanding issues have been resolved.


Director
[Name removed - personal details rules of MSE]
247 Electronics Limited

247 ELECTRONICS LIMITED
COLLINGWOOD BUILDINGS
38 COLLINGWOOD STREET
NEWCASTLE UPON TYNE
ENGLAND
NE1 1JF
Company No. 08035219

chattychappy

S75 gives you legal rights to claim off the CC. The CC can choose to huff and puff, but ultimately you can go to the ombudsman or sue. If you decide to sue, it will be the court that sets the pace - the CC can't "string it out". But iIt could still be weeks or even a few months. (Assuming they don't settle.)

Chargeback is a scheme operated by the networks. You don't have the legal right to a chargeback, although the FOS has said it would be unfair if the CC didn't use it when it is available. CCs can recover their funds via chargeback. You are very much in the hands of the CC when it comes to chareback.

I would make the claim under S75 and do it in writing. If they don't reply, then threaten to sue and do so. If they choose to process it as a chargeback claim, then they are free to do so. It is S75 that gives you a claim - how they meet their legal obligations is up to them. But I would always cooperate with their reasonable demands (copies of orders etc.)

derps

chattychappy wrote: »

I would make the claim under S75 and do it in writing. If they don't reply, then threaten to sue and do so.

I personally would definitely not do this. OP, you'll get your money back right away if you let them raise a chargeback as banks provide upfront refunds. They would then only take the money back if the retailer's bank is able to demonstrate that the claim isn't valid. Since the retailer has said it isn't going to send the goods, it seems like you'll definitely win the claim.

If you sue them, your case will take months and months, it'll cost you money to file your claim and you won't see a refund until after the judgment finally comes through - perhaps just in time for Christmas 2016!

Also, if I was a bank that received a court claim under s.75 from a customer that refused to cooperate with a chargeback, I'd seek to recover my wasted legal costs from the customer. Parties to a dispute are obligated to be reasonable and deal with matters out of court where possible. The bank has a quick and free means of getting your money back so it would be very unreasonable of you to refuse this and go to court and frankly issuing a claim under the circumstances would be ridiculous.

magpiecottage

derps wrote: »

Parties to a dispute are obligated to be reasonable and deal with matters out of court where possible. The bank has a quick and free means of getting your money back so it would be very unreasonable of you to refuse this and go to court and frankly issuing a claim under the circumstances would be ridiculous.

If you say you have lost your money and want to do a S75 claim then the bank has every right to first investigate and see if your assertion is true and it is perfectly reasonable that it should do so.

If it can resolve the matter more quickly by chargeback, it also has every right to do that.

The only circumstance in which it might be better to use S75 if chargeback is available is if you lost more than you paid on the card. This might occur because of a consequential loss or because you only paid part of the cost on the card.

If you go to FOS then the fact that the bank has offered a perfectly suitable alternative but you have not accepted it because you preferred one that would cost the bank money unnecessarily may lead to your complaint being dismissed as frivolous and vexatious.