Bank not responsible for losses to online trading company

Chargebacks, Common scams targeting bank customers,
Jamaal made investments in an online trading company, paying for them with his credit card. Later he became concerned about the online trading and with the assistance of a chargeback company, disputed the credit card transactions. The bank declined to charge back the transactions and he asked us to investigate.
August 2021

Our investigation

The transactions did not give rise to a right to charge the transactions back to the online trading company and we cautioned Jamaal against using chargeback companies (we find that they charge customers for incorrect advice and operate much like scammers). 

However, we learned from discussions with Jamaal that he was not, in fact, disputing the services of the online trading company. Rather, the problem was his inability to use his credit card to deposit more money with them. He explained that he would have to “shore up” his investments if they lost value by depositing more funds to his trading account, and if he did not do so, he would lose his investments. However, he was sometimes unable to deposit funds using his credit card and he would receive messages, sometimes outside bank hours, telling him to contact his bank about this.   

We found that the problem arose from alerts issued by Mastercard (and not the bank). The bank resolved this issue relatively quickly when Jamaal explained what was happening, and he continued making payments to the online trading company. He eventually ceased making deposits because of his concerns about the company’s legitimacy and the losses he was suffering through its performance.

We were unable to find that the bank was responsible for losses he had suffered through the investments and noted the bank had provided clear warnings to Jamaal about being careful about who he invested with in its interactions with him about the transactions.

We concluded it was difficult to find the bank was at fault for the losses he had suffered through the online investments.


Jamaal accepted our view and withdrew his complaint.

Print this page