Customer responsible for transactions, even though probably drugged

Chargebacks, Common scams targeting bank customers,
Trey went to a bar while overseas, and during his visit three transactions totalling $15,000 were charged to his Visa credit card. Trey discovered the transactions the next morning and called the bank immediately, explaining he had been drugged and beaten up and had just come to. He said he had not made the transactions. The bank said its fraud team would look into the matter.
April 2020

The team discovered Trey’s card had been present for the transactions and his PIN had been used. The bank contacted Trey to say Visa’s rules left it with very limited ability to try to recover his losses. It asked him to supply a written statement setting out what he could remember while at the bar. Trey said in his statement that he could recall only brief flashes of events at the bar, and that he believed he had been drugged. He also supplied photos of bruising he received and information he found online about similar bar scams overseas.

Visa rules specify that a merchant must process a transaction within a certain time of its authorisation by a customer. The fraud team uncovered the fact that the bar (or “merchant”) had not processed one of the three transactions, for $8,000, within this time limit.

The bank applied to charge this transaction back to the merchant through Visa. In response, the merchant supplied till receipts and evidence showing the card and PIN had been used together to make all the transactions. The merchant also supplied two CCTV images of Trey in the bar during the relevant time, saying these showed Trey had participated in services he paid for. The bank responded to the merchant through Visa, saying that this information was not relevant to the $8,000 transaction: the simple fact was the merchant had processed the transaction too late. The merchant did not respond to this and the $8,000 was paid back to his card through Visa.

However, the bank told Trey it could not charge back the other two purchases totalling $7,000 because his card and PIN had been used together to make the purchases. It considered he had authorised the transactions. The bank said it had sympathy for his situation and as a goodwill gesture offered him $1,300. He declined the offer and asked us to investigate, saying that he had been drugged, that he must have  made the transactions under duress, and that the merchant’s images, far from proving he had consented to the services he received, merely served to highlight that he had done something completely out of character because he had been the victim of a drug-induced scam.

Our investigation

We accepted it was likely Trey had been drugged. But our role was to establish who was liable for the $7,000, and the answer to that question was in the terms and conditions of the credit card to which Trey had agreed. They stated that he was liable for all card transactions unless they were unauthorised – that is, unless they were carried out by someone else without his authority. In the case of the two transactions totalling $7,000:  

  • The card and PIN were used together to make the transactions.
  • The correct PIN was entered the first time in each case.
  • The CCTV images showed Trey present in the bar that night.

Given those facts, we could not conclude that the transactions were unauthorised, and therefore Trey was liable. We recommended he accept the bank’s goodwill offer.


We did not uphold Trey’s complaint. He did not accept the bank’s goodwill offer.

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