Zamir opened a trading account with Zoomimoney, a trading platform that operates out of Lebanon. Zamir made a number of small trades on the platform. Happy with how his account was going, Zamir transferred $20,000 to the platform in four transactions, using his credit card for payment.
After six months, Zamir became suspicious of Zoomimoney. He requested a withdrawal of $8000 to test whether the platform was genuine. Zamir received the withdrawal and made another deposit into his Zoomimoney account, using his credit card.
A Zoomimoney sales assistant encouraged Zamir to enter a trade that required an advance payment of $16,000, more money than Zamir had in his account. The sales assistant assured Zamir he would be able to enter the trade using his current account balance of $11,000.
When Zamir next logged on, he discovered his account had been debited $60,000 by Zoomimoney. When questioned, the sales assistant said it was because Zamir did not have enough money in his trading account to enter the trade. Zamir was told the debit would be reversed if he deposited $5000 into his Zoomimoney account. Zamir made the transfer but decided that he wanted to exit trading though the Zoomimoney platform.
He requested a $6000 withdrawal. Zoomimoney stopped responding to Zamir. After two weeks, Zamir contacted his credit card provider and requested a charge back for all transactions except his initial transfer to the platform. Zamir’s credit card provider declined his chargeback request.
At some point after becoming aware that Zamir had submitted a chargeback request to his credit card provider, Zoomimoney removed Zamir’s access to his account. Zamir’s $6,000 withdrawal was not processed, he could not access his account and he was not refunded his account balance. Zamir complained to FSCL.
Zamir complained that his credit card provider had unreasonably refused his chargeback request. Zamir felt that the credit card provider had mischaracterised his request by focusing on the authority he had given for the transfers. Zamir agreed that he authorised the transactions, but disputed Zoomimoney’s behaviour. Zamir felt Zoomimoney should be considered a ‘questionable trader’ because it did not provide a genuine trading platform.
The credit card provider said that Zamir authorised and participated in all disputed transactions. The provider argued that Zoomimoney provided a trading platform to Zamir and any losses were trading losses. The chargeback process does not protect against trading losses.
After considering all the evidence provided by Zamir and the credit card provider, we considered that Zamir was not entitled to a chargeback. Zamir was unable to substantiate his claims that Zoomimoney had not provided the service it had promised. Zoomimoney had presented a transaction log showing the trades entered into by Zamir, in response to the chargeback request. We felt that, based on this evidence, it was reasonable for the credit card provider to conclude that Zamir had been given access to a functional trading platform.
The chargeback process is designed to protect consumers against unauthorised transactions or clear-cut fraud. If Zoomimoney was a scam, it was highly complex. It was providing Zamir a real-time trading log and, for the credit card provider to detect any fraudulent behaviour, it would have had to investigate Zoomimoney’s backend systems.
We found that the credit card provider was entitled to declined Zamir’s request for a chargeback. While we could sympathise with Zamir’s situation, the fault lay with the trading platform and not the credit card provider. We did not uphold Zamir’s complaint and recommended that it be discontinued.
Insights for consumers
It is important to always thoroughly check the website that you are trading on. Credit card chargebacks are only available in limited circumstances, and you will need clear evidence of fraud to be entitled to a charge back. If the merchant (in this case, the trading platform) can show you authorised the transaction, it will be very difficult to succeed in a chargeback claim.