Section 75 applies if an item's price is between £100 and £30,000
Are you covered by your credit card provider if you buy something online that turns out to be faulty?
Most people think that they are - but Money Box listener Bill Gilmour found otherwise.
Under section 75 of the Consumer Credit Act of 1974, customers who have a claim against a supplier for breach of contract or misrepresentation generally have an equal claim against the card issuer.
But for section 75 to apply, certain conditions must be met.
Have you had problems buying things online?
Did your credit card provider step in?
Tell us your experiences.
We asked for your comments, a selection of which are below. The debate is now closed.
MOST RECENT COMMENTS:
I bought a £220 item on the 8th of January 2009 from Amazon.co.uk's marketplace. I noticed a charge applied to my account on the 9th, but no delivery of a package. This seemed normal enough, but after two weeks I got suspicious. Nothing had yet been delivered and no e-mails from the seller. The seller firstly ignored my requests for help because the courier claimed to have a signature for the package. However the apparent proof-of-delivery signature was not myself - rather a Mr S Smith. That person does not live at my address! I have had to chase Amazon, the seller, the courier, my credit card company and the police. All I wanted was my package! Still no news after 1.5 months and £220 worse off. Nobody is willing to own this problem and get it resolved.
Robert Youdale, London
I heard your feature last Saturday about the problem of Bill Gilmore who bought something from a third party seller on Amazon. You correctly analysed the problem of credit card cover
ignored the most pertinent factor for that particular transaction, namely the Amazon buyer protection facility! Irrespective of credit card cover, the Amazon protection offered virtually guarantees a refund if problems ensue and should have been the first port of call by My Gilmore, instead of going straight to his credit card company. I have bought many items from third party sellers on Amazon (here and the US site) and on the rare occasion where I've had an unresolved problem with the seller, Amazon have proceeded with my claim and refunded me in full without me resorting to dealing with my credit card company.
Mr L Williams, Hockwold, Norfolk
The Section 75 and my credit card provider came up trumps for me. I decided to have our tired old bathroom in our home completely revamped with a nice new bathroom that my family could enjoy. The installation was very poor considering the the cost of the job and I complained early on. From a quoted 10 day installation the job was still unfinished five months later. My greatest regret was being seduced by a bright and impressive showroom and the feeling that we had nothing to worry about from the appearances of this firm. I fell right into the trap of signing up to an unfair contract. The terms were that by the day of "commencement" I had effectively paid 90% of the contract value and from then on of course I had very little leverage. The firm just weren't interested. My credit card company, under the section 75 rule, came to my rescue and reimbursed me £19,091.66! It took a long time to sort out, lots of legal help (thanks to Which?) and letters, but we got there in the end. There was always the option of going to court but the best advice I had right at the end was from a senior partner at a law firm who said that while I might win in court (and he thought I might), he said you can never be sure. Also, assuming that you do win, your problems aren't over. They may not pay and the most pertinent question was: Did I know if the contactor was solvent? I didn't, so I went the section 75 route and was delighted they paid up and the whole nightmare is over.
Andrew Benfield, Oxford
I purchased a Playstation 3 from a company in Hong Kong using my credit card - £275.99 (plus approx £40 import tax later) and when the item stopped working and going through the normal channels unsuccessfully to get it sorted (it was going to cost a third of the value to post it back) I turned to Trading Standards who suggested I could get a refund through my credit card company. This was turned down because section 75 only recognises a three party relationship. Where a payment agency such as in my case, PayPal, was introduced, then it became a four party issue. The financial ombudsman is now dealing with this on my behalf but from what you say do I hold out much hope of getting a refund.
Sarah Kemp, Near Sheffield
Some years ago I bought a computer from Quantex. They ceased trading some six months later and the warranty went with them at the same time as the computer failed. I asked my credit card company to assist under section 75. They prevaricated, in the time honoured way, in the hope that you give up and go away. An appeal to the CEO resulted in a letter assuring me in writing that they had no responsibility under section 75. I raised an action in the small claims court and after many threats from the credit card company - we will use a barrister, you cannot possibly win against us, etc. - they settled on the day before the hearing. They knew their case was indefensible but credit card companies will do everything, including lying about their responsibilities, to avoid paying out if at all possible. On the programme it was suggested that consumers could not take on a bank or credit card company. You can. The court will help you through the procedures and if the facts are correctly presented, you will win. In my case I never had to leave my house to get a settlement. It was all done by post, phone and fax. I would suggest Javaid uses the small claims court to get satisfaction.
Bernard Mahan, Edinburgh
I purchased three pairs of "Ugg" boots before Christmas as gifts from an online shop. One of the pairs has fallen apart. I paid by credit card in excess of £250.00 total for three pairs but now have a claim for one. The credit card company is saying because they arrived in good condition and have since fallen apart 25 days later I can not claim from them. I have also been in touch with Trading Standards and consumer direct, having tracked down who registered the name of the website. I have discovered it is a fake address and name and that the boots are probably counterfeit.
Lorna Hammer-Newton, Beckenham, Kent
Just for the record, items that are not covered include motor vehicles, boats, aircraft, their engines and accessories; tickets and money, foodstuffs, drink, perishables and work done by tradesmen. (this list is from memory so there are probably more exclusions). What is covered? I paid for 200 metres of CCTV cable but was sent 100 metres. PayPal only covers
of goods not the
of the goods (so it's OK to send 100m instead of 200m?) Credit card company equally obnoxious and Trading Standards say I have to get the firm to collect the 100m and refund my money. (could end up with no cable and no money!) Welcome to Third World Britain!
David Benyon, Bude
I am the primary cardholder of a credit card but when I purchased underlay online and when it came to the visa verification process I was asked for my partners password (I cancelled my password as I kept forgetting mine). We entered the password incorrectly three times and as the transaction didn't appear to go through we closed the website down and reordered via the telephone the next day. Both orders then arrived when we were out at work and although the company are willing to refund for the underlay we will have to pay for the collection. My credit card company are saying it is the carpet company's website's fault, the carpet company blames the verification process. Has anyone else had any problems with Verified by Visa? As far and I can see its not a very secure system.
This consumer credit act is stacked against the supplier. A guy in the US ordered from my web based company a pair of antique French sideboards, paid by his credit card and then arranged shipping independently. He then cancelled the deal by telling the credit card company he hadn't received the goods. We were charged back and now he has his money back and our goods are with his shippers who refuse to give us back our sideboards until we pay all their fees. A typically badly thought out piece of legislation and the reason we no longer sell antiques to the USA by credit card. As a matter of interest, does anyone know if this act is enforceable if purchases are paid by bank transfer?
In many years of online shopping, I have never had a problem. On Amazon, I check the reputation of the seller. PayPal has always offered me good protection. Now, selling is a different matter - PayPal is really tough and can take money back from the seller.
John B, Leicester
I made a purchase through a link on eBay and paid via PayPal with a credit card, thinking naively I was doubly covered with PayPal and credit card cover. I thought the boots were coming from the US - it now appears that they were coming from China. To cut a long story short I've never received them, the postal tracking system stopping with delivery in the US. Several e-mails have gone back and forth to no avail. PayPal have now said they can't/won't help me with a dispute and it appears from your programme earlier that I won't be able to claim from the credit card co as the purchase was under £100, so it seems that I wasn't covered at all. I also have a claim with the CAA, but after 14 weeks with no word it looks like they are going to tell us to claim against the credit card company which, according to an earlier posting, will be another no go as they will now say the claim is too late.
Although it is the law, I see no good reason why using a credit card should give greater protection than other methods of payment. Credit card companies are not to blame for shoddy goods and suppliers going out of business. Trading Standards departments should be given enough resources and some real teeth to deal with shoddy goods. The problem of bankrupt suppliers is probably best dealt with by additional sections in holiday, household and motor insurance policies.
Chris Grey, Guildford
We purchased a BBQ online and when we unpacked it three months later it was found to be of grossly inferior quality and manufacture. It cost us £450 and certainly was not worth more than £75. The supplier refused to do anything because we had opened and assembled it. We had lots of conflicting advice from our credit card - but when we made a claim as advised by Trading Standards we were told we had no rights as the card is a "charge card" i.e. payable in full monthly, not a credit card. We understood that we shouldn't use a debit card in order to get credit card protection, but had no idea that we weren't covered for this one.
Christina Kemp, Denmead, Hampshire
Re Amazon third party suppliers: Your news item this morning gave the impression that Amazon police these advertisers and throw them off the site if there are problems. I am sorry to say this is simply not true, as I purchased a faulty (and potentially hazardous) product from one their third party suppliers and have received very little help from Amazon when this supplier simply refused to respond to e-mails from me and they are still advertising on Amazon. It is now becoming increasingly difficult to identify who is a third party supplier in many parts of their web site.
John Millns, Romsey
The annoying thing is the company is still trading and advertising
Rebecca Bradley, Leicester
Are there any safeguards if you purchase goods over the internet with debit card as opposed to credit card? I paid for a gear box with my debit card last August and the goods were never supplied. I was promised a refund from the company which has never happened. I have gone through all the recommended procedures from Trading Standards but none of them have resulted in getting my money back. The annoying thing is the company is still trading and advertising on the internet so it's not a matter that they have gone bust. I am student and £200 is a lot of money to me which I cant afford to forget about - which is what I'm sure the company is hoping.
Rebecca Bradley, Leicester
We recently purchased two nights' hotel accommodation in Milan as a present for two friends. We booked and paid up front using our credit card. The flight to Milan was cancelled because of snow. The credit card helpdesk said we could not claim a refund on our credit card. We were surprised.
Gray and Roberta Cantillon, Holywood, County Down
Last year we were unfortunate enough to lose a holiday booking because of Excel's demise. We put in a claim and received a claim number. The agent handling the claims for the CAA wrote to us in November and asked us not to contact them as there was an unexpected delay with the CAA being given the go ahead to pay out claims. Yesterday after giving them three months I contacted them to find out that they still haven't been given the go ahead and meanwhile I am having to pay interest on the money on a credit card (we managed to rebook a holiday). When I contacted the credit card company yesterday to bring them in to the loop, I was told that they would not be paying back any monies as the time had run out! CAA told me I had done the right thing by claiming through them. The moral of the story seems to be don't trust the banks! I have to carry on paying interest on the flight charges for, how long?
Alison Evans, LLanelli
It was good to know that Visa were prepared to do it
When an internet travel booking company take a booking for accommodation they accept no responsibility, they pass on the booking to a third party and the contract is with the third party even though the payment is made to the travel booking company. A guest house abroad denied the booking and payment but Visa did offer to give our money back as we paid by Visa. We did not have to call on this because the third party paid up but it was good to know that Visa were prepared to do it. I would be interested to know if this is covered by section 75 protection as it was not clear.
I bought three air tickets from using my credit card in October 2008. For personal reasons I had to cancel my plan and applied for a refund. I received a partial refund from the airline - one adult and child. I am still waiting for another refund - one adult. I have tried contacting the company through telephone, email and letter all in vain. I have now raised it with my credit card company but have not heard from them as well. Now I'm in a situation where I do not know what to do.
Last year I purchased a digital camcorder from Amazon two weeks into using it the screen failed to display anything. I contacted Amazon they told me I had to send it back to the supplier for repair which was in Germany. I thought I had bought if from Amazon. I had to foot the postage which was £12.00 and I waited four weeks for its repaired return and was not reimbursed for the postage, not offered a new one or a refund. I paid by debit card for this item and contacted my bank for information about a refund instead of a repaired camera. They said they could only step in if when I received the camera back I wasn't happy. I wasn't happy as they had £185.00 of my money and I didn't have the camera. If I had bought that from a shop it would have been a refund or a replacement of a new one. So I will not buy that way again.
Mrs Greenwood, Burnley, Lancashire
I was aware that you have to pay the seller directly with a credit card in order to get the benefit of section 75. However, I also understand that using PayPal (widely used for online payments and protection of personal/card details) when making non-eBay purchases negates section 75 application, because the credit card transaction is with PayPal, not the goods supplier.
E More, Basingstoke
I have just gone through a two year battle with my credit card company over a faulty treadmill I bought from eBay. Fortunately, I rang the seller directly to make the payment so was covered under section 75. However, I had to go to the financial ombudsman before I got it resolved. During the course of this saga I learned more about Section 75 than I ever wished to know. However, the one thing that was astonishing and I think you should highlight is that if you have a secondary card holder (e.g. for ease my wife has a card that charges to my bill)
of her purchases on that credit card are covered by Section 75. Lots of people have secondary cards on their account for either spouses or children and must be under the mistaken belief that their purchases are protected. People need to know this!
In the summer I purchased a pair of tickets for a gig but never received the tickets. I went onto the company website that I had purchased the tickets from and it said they had liquidated and that the PIU were investigating but no one would get tickets or their money back. I contacted my bank, HSBC, to inform them and as I had paid on my credit card hopefully activate the insurance. I was told that it only applied to purchases over £100 and as I paid £85 it probably wouldn't cover my purchase. In any case, they sent me a form to complete. Seven months later, after no communication from the bank over the matter and having given up the thought of getting my money back, I received a letter from HSBC informing me that they had just credited my account with £85. Fantastic. It restored a bit of faith that I have with them as I don't think they were obliged to make the payment.
I own a fishing tackle shop in Birmingham and you are very welcome to hear the other side of the equation where customer can retrieve their money back six months after a purchase and there is nothing we can do to stop the card companies taking the money despite customer claims being fraudulent.
Tony Troth, Birmingham
I bought £1,400 car audio system online and was extremely unsatisfied by the company's installation and equipment. So I returned the item within 14 days using their online return system. Since then I have not heard from them. I have the postal signed for receipts confirming that they had received the items. I called the bank but they asked me to sort this out with the supplier I bought the items from. I applied for online money claim, but the supplier did not receive the mail saying they don't know me and the that the address does not belong to them. This company is still selling equipment online. I have now lost my money and the equipment.
Javaid Soomro, London
I recently bought a ceramic sink and arranged my own collection/delivery. It arrived broken. Previously with my credit card I had been covered for theft and damage (I successfully claimed in 2003 when goods bought for Christmas on my card were stolen from my car) but now after the credit card company has been taken over, they advised this cover had been cancelled. I lost £146.
Gary Allen, Ashford, Kent
The comments we publish are not necessarily the views of the BBC but will reflect the balance of views we have received. It is helpful if contributors state if they work for any organisation relevant to an issue discussed. Readers should form their own views on whether messages published represent undeclared interests, or views prompted by a common source.