CIFAS Marker - Chance of appeal

Alienatrix1

Hello,

I would like yo know the chance of success in getting a CIFAS marker removed.

Background is this:

Raised a chargeback with my credit card following a purchase of an item, that did not arrive

This was rejected, however I believe that the credit card wasn't happy with the chargeback even being raised, because shortly after they applied a spending block on my account under the pretext that they wanted to verify the payment source to my credit card..If found this very strange, but I complied nonetheless and provided everything they requested.

After a month of radio silence, the credit card company decided to close my account..I thought "fair enough"..but at no point did they state that a CIFAS marker had been registered against me.

However, I wanted to be proactive and check anyway.. And then I discovered that they had indeed applied a CIFAS marker 5 under misuse of facility.

To say that I was angry is an understatement. The fact that I was never even given an opportunity to address an concerns they may have had, surely is a breach of their consumer duties. Additionally, the fact that they never informed of of the CIFAS being registered against me is a breach of transparency aswell, isn't it?

I have raised this with the credit card company, and CIFAS and I'm currently awaiting on a response. Obviously, FOS would be my next step eventually.

But, given the credit card company's severe lack of following due process, where do you think I stand with regards to arguing for its removal?

I should also add that I have never previously had any such issue, so this is the first time that this has happened to me.

Thanks in advance.

DullGreyGuy

With many types of financial crime it's a criminal offence to tell the potential suspect that they are under investigation. 

You may find it interesting to read https://www.financial-ombudsman.org.uk/decision/DRN-3879363.pdf as to how the ombudsman sees these types of things, though there are also cases where complaints have been upheld where the ombudsman thinks the bank didnt give the customer enough opportunity to explain the transactions that caused concern. 

Alienatrix1

Interesting read. However, this is vastly different to my case as I am in a position, and would have been, to address an allegations, fraudulent or otherwise.

With regard to 'tipping off' a customer about any financial crime they're being accused of, surely any situations in which a consumer is being accused/suspected of something 'dodgy', they must still be given a chance to explain. Otherwise, a company could quite easily apply CIFAS markers against their customers without any accountability.

I guess the point I'm making is that in the interest of fairness, transparency and consumer responsibility and duty of care, a financial institution has to allow a customer the opportunity to explain before applying severe financial penalties such as a CIFAS marker.

penners324

Cifas marker 5 means indicates they believe there's been Fraudulent activity on your account, potentially by you.

By law they cannot tell you what is going on.

All you can do is lodge an official complaint with the company, escalate to the FOS if rejected.

Sounds like the merchant rejected the charge back, accusing you of fraud at that point, which was upheld by the card company 

penners324

The only other way to change this so consumers do get given the right of reply is to change the law. Possibly in the High Court or through the House of Commons

Alienatrix1

Thank you all for your input, some very interesting points indeed.

I think this will definitely require FOS intervention, chiefly because a financial institution must have some some level of duty of care and accountability towards their customers before recording any adverse information.

Regardless of what a merchant claims, consumers have to be be given an opportunity to explain, surely?

Hoenir

The outcome may well depend on if there's considered to be a legimate reason for the attempted chargeback. A frivolous use of the facility is likely to be considered fraud. Whether it's intended or not. There's not the time or resources to waste on such events. Terminatating the business relationship deals with the matter once and for all.

Alienatrix1

Which is fine, I have no qualms with them terminating their relationship with me.

Where it becomes contentious, and unfair, is when they decide upon themselves to record a CIFAS against a former customer because of what a merchant may have alleged, without giving me an opportunity to address an concerns regarding alleged misuse on my part.

Additionally, the fact that a spending block was applied to my account under the pretext of a verification of the source of payments stinks of misleading practice from their side.

I complied with all of the requirements and supplied everything they asked for during the time my account was under review. It is only fair that the reciprocate that, which isn't too much to ask.

I get all the Anti-money laundering and tipping rules etc...But when their actions lead to severe financial implications for a customer, due process cannot be ignored under any circumstances.

I believe that CIFAS published guidance which requires financial institutions under Consumer Duties to engage with customers before taking serious action against them.

eskbanker

Alienatrix1 said:

I believe that CIFAS published guidance which requires financial institutions under Consumer Duties to engage with customers before taking serious action against them.

It's not up to CIFAS to direct financial institutions, that's the role of the FCA....

Alienatrix1

eskbanker said:

Alienatrix1 said:

I believe that CIFAS published guidance which requires financial institutions under Consumer Duties to engage with customers before taking serious action against them.

It's not up to CIFAS to direct financial institutions, that's the role of the FCA....

I meant to say that the FCA published guidance under Consumer Duties 2023.

Don't financial institutions have to give a customer an opportunity to address any concerns they have about their account conduct/behaviour before take long such severe adverse action against their customer?

Surely that's a fundamental right for fairness and transparency?

Anyway, it's currently with FOS, we'll see how it pans out.