Noted banking security expert Ross Anderson was forced to threaten action in the small claims court before his bank agreed to refund a disputed transaction.
Anderson, professor in security engineering at the University of Cambridge Computer Laboratory, who has often appeared as an expert witness for plaintiffs in so-called "phantom withdrawal" cases, found himself arguing on his own behalf over a disputed £126.51 transaction last June. Payment from a joint NatWest credit card account used by Anderson's wife was credited to “Ian Travel Services”, a firm Anderson discovered was also the subject of other complaints.
After his wife got nowhere after complaining to NatWest over the phone, Anderson took up the case and wrote to the bank asking it to either reverse the transaction or provide evidence that it was made with the mandate of the Andersons. The computer security expert was asked to sign declarations. Anderson agreed to sign a declaration that he didn’t recognise the transaction but not the second, saying that he or his wife hadn’t made it.
Anderson cited the distance selling directive in asking for documents on the transaction. NatWest agreed to request a copy of the voucher “through the retailer's acquiring bank”.
Two months passed before NatWest replied that the retailer had said the disputed transaction was made via hotels.com. Anderson replied that hotels.com had told it that the details of the NatWest card held by the Andersons were compromised when an auditor for the online hotel booking service lost a laptop.
A month later NatWest said the complaint was now out of time, advising Anderson to contact the financial ombudsman or citizens' advice. Anderson lacked confidence in the ombudsman from previous experience, so he decided to commence proceedings against NatWest in the small claims court. As well as the value of the disputed transaction Anderson claimed for a late payment fee of £12 levied in December and court fees of £25.
NatWest promptly paid up.
"So now you know – suing the bank is the fastest, simplest and least-hassle way of getting your money back," Anderson writes. He speculates that NatWest and other banks may find it in their interest to drag out claims in the hopes that customers will eventually give up and swallow their losses.
"If it can fob off most complainants with tiresome call-centre procedures, or tell them they’re out of time, or pass them off on Citizen’s Advice, then it will only have to refund the minority who ignore this flummery and go to court," Anderson argues.
Anderson has documented the whole protracted saga in a blog entry on Cambridge Computer Lab's lightbluetouchpaper blog here. He concludes that anyone contesting a disputed transaction, in the UK at least, ought to go straight from a first letter onto a small claims court case and to attempt to keep it in this court, where costs are minimal even if a claimant loses. ®