HSBC UK Bank Plc · DRN-5854324

The complaint Miss S complains that HSBC UK Bank Plc trading as first direct (“First Direct”) failed to act appropriately when she contacted them to dispute a transaction. What happened In July 2025, Miss S used her First Direct credit card to pay £29.95 for a clothing item she ordered from a company I’ll call ‘M’. Miss S says when the item arrived, it didn’t match its description on M’s website. She says it was a different colour and was made using a different material of lower quality. Miss S contacted M and sent them a picture of the item and the advert for it, to illustrate the discrepancies between the two. Miss S asked M for a prepaid return label so she could return the item. M then sent Miss S several e-mails offering different partial refunds. M said these offers were being made so Miss S avoided the costs of returning the item to its temporary warehouse. Miss S said to M repeatedly that she wanted a full refund of the item and that she wasn’t responsible for any return costs. Miss S couldn’t resolve the matter directly with M, so she contacted First Direct for help. They said to Miss S she had no chargeback rights and so they couldn’t help her with her dispute. Miss S was unhappy with this. She felt they were dismissive, ignored her references to relevant UK consumer law, and then closed her complaint within 70 minutes of her raising it. Our investigator didn’t recommend Miss S’s complaint should be upheld. Miss S didn’t agree and so her complaint has been passed to me to decide. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I do understand Miss S’s frustration. She had made several points that speak to the relative strengths of her complaint against M, and I can see why she doesn’t think it’s right she should be out of pocket. But the fact she may have a strong case against M doesn’t necessarily mean that First Direct has treated her unfairly in handling her chargeback claim. The cost of the item was £29.95. This was below the monetary limits in place for claims made under Section 75 of the Consumer Credit 1974. So, First Direct could only really have assisted Miss S in recovering her money through the chargeback process. And the success or otherwise of a chargeback claim is by reference to the card scheme rules, which are set by the card scheme and not the card issuer. The card scheme rules enable a chargeback claim to be made where goods are not as described or are in some way defective. But the rule also requires that goods are returned or a return was attempted. I’m aware of the difficulties Miss S faced in complying with those requirements. The rule though states that an attempt to return would only be valid if M had:

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• Refused the return of the item or refused to provide a return authorisation/label. • Instructed Miss S not to return the item. • Refused to respond to her; or • Didn’t provide clear instructions on how to return the item. I don’t think any of the above scenarios applied in Miss S’s case. And I can’t rewrite the chargeback rule or say that First Direct should have disregarded it. From what I can see, First Direct correctly explained the position to Miss S. Although Miss S feels they did so dismissively and without consideration of the points she had put forward, I don’t think it was unfair of Frist Direct to take the position it did, or to maintain that position when Miss S complained. Even if First Direct had dealt with the claim and the complaint differently, her own evidence shows that she hadn’t returned the item. So, I don’t think she was disadvantaged by the way in which First Direct handled matters overall. While Miss S may feel the rule is inflexible or should take account of the circumstances at play in her case, that isn’t something First Direct has any control over. If Frist Direct had disregarded the card scheme rules, this would simply have led to the card scheme finding in favour of M. I can only deal with the way First Direct handled the claim. That doesn’t mean Miss S can’t rely on the legislation she’s mentioned, and the other points she’s made, to pursue a claim against M itself. But having grounds for a legal claim against M doesn’t mean the same arguments can be successfully made in a chargeback claim. I have every sympathy with Miss S, who’s done nothing wrong here. But for the reasons I’ve set out, I can’t uphold her complaint against First Direct. My final decision I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Miss S to accept or reject my decision before 26 March 2026. Daniel Picken Ombudsman

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