Credit Card refunds for overseas transactions

Started by Boss Man, April 04, 2006, 21:21:11

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Boss Man

Credit Card refunds for overseas transactions - New ruling March 06

On 22nd. March 2006 the Court of Appeal ruled that section 75 of the Consumer Credit Act 1974 applies to overseas as well as domestic transactions.

This should make it easier for UK consumers to obtain refunds from their Credit Card company in respect of Timeshare and Holiday Club transactions which go wrong. In turn it will almost certainly make the Credit Card issuers take much more care when authorising suppliers' accounts in the future.

Note that this relates only to CREDIT CARDS and not to debit cards or charge cards. Marketers will by now be aware of this and will therefore probably try to pressure buyers into using debit or charge cards, or to draw cash, in an attempt to avoid any charge-back. This should be avoided like the plague.

The Act says that:

Section 75(1) states that card issuers are jointly and severally liable for any misrepresentation or breach of contract in relation to a transaction with a cash price of £100 to £30,000 which is financed by an agreement regulated by the Consumer Credit Act 1974.

OFT advises:

. Thanks to the consumer protection of section 75, money that seemed lost on a credit card purchase can be claimed back
. If you pay by credit card you can claim your money back from the card company if the seller fails to honour the contract, or the item is faulty or if the seller wrongly describes it or if the supplier goes out of business
. You do not have to attempt to claim your money back from the seller first - the credit card company is individually liable
. If you are buying an item costing over £100 and you are asked for a deposit, consider paying the deposit by credit card
. You are not covered by section 75 if you use a debit or charge card.

Link to the Office of Fair Trading Press Release of 23rd  March 2006:- http://www.oft.gov.uk/News/Press+releases/2006/60-06.htm

Thanks to Oldbill for the heads-up on this

Boss Man


DJAM

Is there any time limit from when the payment was made? I was scammed in March 2005.

OldBill

The 1974 Act (unfortunately not available on line from HMSO) imposes joint and several liability upon the supplier and the provider of credit. This being the case, where there is a contract for supply, I presume that the usual six year period applies - leaving the credit card provider to carry the can on its own even if the supplier has gone out of business. This will commence at the point at which the supplier fails to supply or otherwise breaches the contract. If it came to Court action it is reasonable to assume that failure on the part of the consumer to proceed within a reasonable time of becoming aware of the breach could affect the outcome.

Note that the Consumer Credit Act 2006 became law only last week, and I haven't had time to read that one yet.

OldBill

Whole transaction may be covered even if only the deposit was paid by credit card

An article in "Accountancy" this month states:-
There is no need to claim against the foreign retailer. A claim may be made against the card issuer alone. Furthermore it is not necessary that the whole of the price of the goods or services should have been paid by use of a credit card; for example, if a consumer purchases an item with a cash price between £100 and £30,000 and is asked to pay a deposit, the transaction will be a protected one if the deposit is paid by using a credit card

My wife was recently ripped off by HAB. I claimed under section 75(1) of the consumer credit act and have got my money back. Will the credit card companies stop them though????

Regards, John

OldBill

One or two posts around the web suggest that some companies are now becoming wise to this and pressing for payment by debit card, bank transfer or cash. Never use any of these methods as there is no protection under the Consumer Credit Act. Better yet - if it's a Holiday Club or an iffy reseller don't pay them at all.

DJAM

Old Bill

Thanks for the info. I contacted my credit card company asking them the process for making a claim now that the law had changed. They asked for the paperwork, which I duly sent. After an initial suggestion that I contact a solicitor, when I wrote back asking again for the procedure to make a claim, they credited my credit card. So, I have got my money back.
I am still bitter about being scammed by WTP who I expect are still trading.

Regards,

DJAM

teideglow

signed agreement in nov 2006 with interest free loan for petchey leisure points loan to come from clydesdale bank (introduced to us by petchey leisure) in form of credit card with a limit so we can make further purchases!!!! will this be subject to march 2006 ruling?

OldBill

I don't see why not - the criterion is the provision of credit, not who gave it, why, or the charging of interest. Whether you can make any claim does of course depend on the reasons for doing so.

sensor

Teideglow,
Did you, or are you in the process of pursuing this?
If so, please keep us informed.

teideglow

consumer direct advised write to clydesdale & petchey requesting reply in 7 working days. only responce is statement from clydesdale so back to consumer direct as contract has been breached.

teideglow

Clydesdale bank not answering letters - do not know if they are credit card or "Store card"- maybe different rules. Can anyone help please ? Trading standards have said it is above the level that they can help with !!!!!!! advised a solicitor. That could mean more money down the drain.

Keitht

quote:
Originally posted by teideglow

Clydesdale bank not answering letters - do not know if they are credit card or "Store card"- maybe different rules. Can anyone help please ? Trading standards have said it is above the level that they can help with !!!!!!! advised a solicitor. That could mean more money down the drain.



Would it be realistic to restrict the level of the claim to one at which TA or CA can assist?  What about going to the small claims court?  I understand much of this can now be done on-line.  Cost is minimal and if Clydesdale continue to ignore the situation you are likely to win by default.

OldBill

If you have been given credit the Act applies to the deal if between £100 and £30,000. The use or non-use of plastic is not relevant nor is its type. I am surprised that a bank is not answering letters. Try Special Delivery with a threat of action (including but not limited to saying that you will take it up with the Ombusdman - see below) if there is no response within seven days. "Small Claims" County Court procedure is for claims up to £5k but the full procedure is not complicated. I presume that you are claiming a known amount of money back. See this before proceeding -
www.hmcourts-service.gov.uk/courtfinder/forms/ex301_0406.pdf
Note that the Court will usually expect you to have made reasonable attempts to recover, including "Alternative dispute resolution" before using them. This could include contacting the Banking Ombudsman.

teideglow

Thanks for advice. I telephoned Clydesdale bank today and was told it is with their section 75 dealing with misselling and they were investigating my complaint with petchey leisure, and that i should get a reply within 5 to 7 days at the latest, so I will wait one week and if not satisfied i will contact banking omudsman. Man i spoke to reluctantly confirmed it is a "club card", but if it is still subject to march 2006 ruling then we should be ok.Many thanks, throughout all this your web site has been invaluble.

Hi
I feel really stupid for the necessity to post this messgage. We were ripped off by a dodgy builder a few years ago to the tune of nearly 8k so you would assume that we would be a little more cautious now! Back in Janury we were contacted by Travel World Spain with the offer of selling out timeshare in Tenerife. A few weeks later they came back and said they had a buyer who was willing to offer 9k for the two weeks (which i found somewhat unbelievable!!). Well I guess you know what happened next - we stumped up 800 euros. The guy on the phone was really insistent about the payment date, I even had to phone my bank manager to let us pay out of uncleared funds (Even more stupid). I made the payment on my Lloyds debit card so I know I don't have a leg to stand on currently. I have a receipt for the transaction and a very homemade looking contract (which states 12 months). I think that I may need to write this one off to experience, but wanted to share this with other trusting souls out there in the hope that someone else will have the foresight to do a bit of reasearch first!!

frankleach

All highly interesting to someone trying tyo sell their timeshare, as I am. The latest "offer" received today from Dunstar Leisure and Travel (new to me??) says they need $900 deposit payable by CREDIT card, to secure a sale of £8k, with a six day get-out clause but a contract completion period of 8 to ten weeks. The company is based in Spain as usual. Can Bossman confirm that I would indeed be covered by the credit guarantee? Seems too easy to me?

Keitht

quote:
Originally posted by senseless

 I made the payment on my Lloyds debit card so I know I don't have a leg to stand on currently. I have a receipt for the transaction and a very homemade looking contract (which states 12 months). I think that I may need to write this one off to experience,


Lloyds Bank Credit Cards are Visa cards and you may well find that you are covered.  Contact your bank.  Explain what has happened and that you believe you have been part of a scam.  They almost certainly won't even consider paying out yet if the contract says 12 months, but you will have flagged the problem.  
What will probably happen next is that Travel World will come back to you saying they have another buyer but the offer price is a few hundred pounds.  Naturally you say No.  Travel World claim to have fulfilled their obligation and will refuse the refund.  It's a common scam.
If you get no help from the bank speak to your local Citizen's Advice.  It was on a totally different thing, but my brother had a situation where neither the bank nor the vendor would do anything to resolve a problem.  He went to CA who sent letters on his behalf.  Problem solved very quickly then!!

frankleach

Further to my message of 24th May, I accessed this site's report on Dunstar via Google. Must remember how to use the "Search" facility here! The existing reports cover it fully! I am so glad I found you!
Thanks.

Thanks for your advice - I will speak to my bank. Funilly enough a couple of days after we stupidly made the transfer I had a meeting with my bank manager and told her all about the deal - She was really interested as a time share owner herself! hope she hasn't gone down the same road!!
[:D]

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