These case studies have been modified so as not to identify any actual cases at FIDReC. They are provided for purposes of learning and are not necessarily indicative of outcomes at FIDReC.
Mary brought a credit card from her financial institution (FI) along for a business trip. She boarded her flight and placed her wallet in her backpack. She stowed the backpack in the plane’s overhead compartment. During the flight, Mary dozed off and left her seat a few times to use the restroom.
Unfortunately, at some point in the flight, the credit card was stolen. Mary only discovered this when she reached her hotel and wanted to use the credit card to pay for her cab fare. When she called her FI to check, 20 fraudulent transactions had already been charged to the card. The FI helped to block Mary’s card and replaced it with a new one but still held Mary responsible for the transactions.
Mary argued that the FI did not block the transactions or verify them with her even though they were unlike her usual spending patterns. She also called the FI within 5 minutes to report the fraudulent transactions when she noticed the loss of her card.
The FI explained that there was no chargeback for transactions made using a physical card, and it had done what it could. It was also more than an hour after the transaction alerts sent to her phone that Mary contacted the FI. Mary disagreed and came to FIDReC.
During mediation, the FI representative shared the view that Mary was careless in safekeeping the card. Mary could have secured her backpack with a lock or kept her card on her person as a credit card should not be left unattended. Mary accepted that she could have done more to keep her credit card safe but emphasised that her actions were not unreasonable and that she had reported the loss as soon as she could. Mary also asked for understanding and compassion given her good record with the FI.
The FI reconsidered the matter after mediation and later offered to settle the matter. It proposed to share 20% of Mary’s losses. Mary accepted the goodwill offer.
Key Learning Points
Treat your credit cards like cash and keep them safe, especially when travelling. FIDReC has noticed an increase in disputes involving cards lost overseas.
Under the The Association of Banks in Singapore Code of Practice for Banks - Credit Cards, a cardholder's liability for unauthorised transactions is $100 if:
a. The cardholder has not acted fraudulently or been grossly negligent. Banks have found customers grossly negligent when they leave a wallet (with a credit card in it) unattended in an unsecured area.
b. The cardholder informed the card issuer as soon as reasonably practicable after becoming aware that the card had been lost or stolen.
There is a chargeback mechanism from card scheme rules that allow credit card holders to dispute a charge and request their money back. There are exceptions to this, for example, where a transactions is a “card present” transaction where the physical card is used. Your bank can assist you with the chargeback.
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