Ombudsman confirms- Consumer Credit Act does help consumers at risk of getting shafted

credit cardsSometimes bad stuff happens. Sometimes it's our own fault, like when we agreed to let the mother-in-law come to stay, and sometimes it's clearly someone else's fault, like when we spend our hard earned cash on a long-coveted product only to have it shrivel up and die 4 weeks and 6 days after purchase.

The problem is that quite often no one is desperately keen on taking responsibility for the crappy purchase. If you challenge the retailer, they may refer you to the maunfacturer; the manufacturer sends you back to the retailer and you go on in a neverending circle or frustration and irritation, all the while without either your cash, or product.

Well now, a recent complaint has confirmed that there is someone else to blame. Your credit card company. You will recall the advice to always book a holiday on a credit card because if things go pear shaped, you can claim against the credit card company? Well now, it seems this protection extends to all purchases over £100*.

The Financial Ombudsman Service (FOS) has published details of a ruling where it upheld a complaint by a young college student - identified as Miss T - who bought a laptop for her studies using a credit card but which developed a serious fault after just six weeks. The store refused to do anything about it and referred her to the manufacturer so she contacted her credit card company, explained the problem and asked for a refund. However, the card provider turned her away saying it was "not responsible for the quality of goods bought with a credit card".

The student complained to the FOS which has ruled in her favour as the laptop was not fit for purpose, as it should not have developed a fault of this nature so soon after Miss T had bought it.

The watchdog agreed that the retailer was at fault, but, significantly, ruled that the credit card company was also responsible, saying "we pointed out to the card provider that it was jointly liable with the supplier for any breach of contract. The supplier had been in breach of contract by selling a laptop that was not fit for purpose, so we told the card provider to reimburse Miss T for the cost of the faulty laptop and of the two independent reports she had obtained plus £100 for failing to handle the claim correctly."

*clearly this is a £100 or more purchase using a credit card. Cash will not do. It also doesn't cover purchases over £30,000, so don't go rushing out to buy a Zonda or anything.


  • Alexis
    Virtually every bank automatically rejects any such claim as a matter of course. Only quoting the CC Act and the Financial Ombudsman seems to make them give in, and it usually takes more than one letter. Barclays are renowned as being the worst and reject everything in the hope you'll give up and go away. HSBC tend to be quite reasonable. The Ombudsman needs to look at the whole culture of banks' responses to these things. For every Miss T there are 20 others who get fobbed off.
  • Eric
    Plus, in any event, you do not have a contract with the manufacturer so they are under no obligation to do anything for you. Your contract is with the retailer.
  • John C.
    Did Miss T get shafted by Currys or PC World? Answers below people
  • Miss T.
  • Dick
    > *clearly this is a £100 or more purchase using a credit card. Cash will not do. You only need to pay a bit of it with the card, so cash will do. If you pay for a £200 item, with £190 cash and a tenner on your credit card, you are still protected.

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