Santander UK Plc · DRN-6163736

The complaint Mr H has complained about Santander UK Plc declining a claim for money back. What happened The parties are familiar with the background details of this complaint – so, I’ll only briefly summarise them here. It reflects my role of resolving disputes quickly with minimum formality. Before travelling to Spain, Mr H booked a hire car (at a cost of £201.55) using a comparison website, who I’ll refer to as D. He also agreed to take out the premium insurance cover they recommended. He paid £77.03 for this using his Santander debit card. But when he went to collect the vehicle Mr H says he was told by the hire company, who I’ll refer to as T, he needed to take out their excess cover through their recommended insurer. Mr H says he made T aware he already had the required insurance through D, but they insisted he pay for their coverage. Mr H says that to get the hire vehicle he felt forced to pay for the duplicate cover. While in Spain Mr H complained to both D and T about him being sold identical insurance for the same vehicle for the same period of cover. Both D and T declined to provide any form of refund to Mr H. So, Mr H asked Santander for help in getting his money back saying, in summary, that: • He was subjected to aggressive upselling of unwanted and unnecessary insurance by T – insurance he didn’t need as the required coverage was provided by the insurance policy he’d bought from D. • He was charged a total amount of £328.44 by T. So, he paid far more than he should have. • Issues with the car meant it was difficult to drive as the safety features and warnings were all in Spanish – which Mr H doesn’t speak or understand. • He didn’t think it was fair for Santander to charge interest on the disputed amount while the dispute was ongoing or apply late payment fees on that balance. Santander said they were unable to raise a chargeback for the disputed transaction amount because there were no grounds for doing so under the scheme rules. Santander also said they didn’t think the evidence supported there had been any misrepresentation by T at the point of sale or a subsequent breach of contract under Section 75 of the Consumer Credit Act 1974 (S75 CCA). Santander also said the monthly minimum payment still needed to be paid. And as Mr H wasn’t making the payments required, he was incurring late payment fees, and the late payments may also be impacting his credit file.

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This led to Mr H raising a complaint to Santander about the outcome and how they’d handled the matter with Mr H saying Santander had failed to explain what sort of further information they needed to enable the claims to proceed. Santander responded by saying they’d handled both the chargeback and S75 CCA claims fairly and in line with the respective rules and regulations. Unhappy with Santander’s final response, Mr H asked the Financial Ombudsman to consider the matter. Our Investigator upheld the complaint in part. They thought Santander had acted fairly when deciding not to raise a chargeback. They also said they hadn’t seen any evidence which would lead them to conclude there had been any misrepresentation or a breach of contract under S75 CCA. However, the Investigator did think Santander ought to have better explained why the claims hadn’t been successful and provided more clarity about what additional information may have enabled them to consider the S75 CCA claim further. So, the Investigator recommended Santander pay Mr H a distress and inconvenience payment of £50. Santander accepted the Investigator’s findings, but Mr H did not. So, the complaint has come to me to make a final decision. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Mr H has made several detailed points in his complaint including in the submissions he’s provided following the Investigator issuing their findings. But in my decision, I don’t intend to refer to everything or address every point made. I mean no discourtesy by this, instead I will focus on what I see as being the key outstanding points following the Investigator’s outcome, and the reasons for making my decision. It’s my understanding that in Spain, third-party liability insurance with EU-compliant coverage is required by law. This covers a driver’s liability for damage to other vehicles and persons. It seems that while you can decline any coverage offered by the hire company, you will instead likely need to leave a large deposit on a credit card – with this requirement being necessary irrespective of what alternative cover you may already have in place. This enables the hire company to easily recover any costs while the driver makes a claim against the third-party insurer. Among other things, in the confirmation email Mr H received from D it said: • ‘T will ask you to leave a deposit of 1000.00 €. They won’t actually take any money – they’ll just block the deposit from your credit card in case there’s any damage. And when you return your vehicle in the same condition it was collected in, the deposit amount will be unblocked. If there is any damage to the vehicle, T will retain part or all of your deposit to pay for the damage. Excess damage charges can then be claimed back from your Platinum Excess Insurance Policy after the rental. Please note that the car hire company may also offer you their own excess cover at the desk. Our product already provides you with valid cover for your car hire excess and we want to prevent you from ending up being dually insured. If you wish to consider an alternative option, please be aware that this product may differ in terms of price and policy coverage.’ Given the above, I appreciate why Mr H thought he didn’t need to take any further insurance through the hire company – he only had to leave a deposit. So, I appreciate why Mr H asked

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Santander for help in getting back what he paid to T for the insurance policy. Mr H has also highlighted there are many reviews and forums about this scenario readily available on the Internet. The transaction was made using a credit card so that provides two possible routes to try to resolve the dispute – chargeback and S75 CCA. So, I’ve considered both of these and whether Santander acted fairly when considering the disputed payment. It isn’t for me to decide here if T acted fairly – I don’t have the power to do so. What I need to decide, is whether I think Santander acted fairly when declining to refund the disputed amount to Mr H and if there were any delays or other issues in how they handled the matter. Chargeback A ‘chargeback’ is a way for a debit or credit card provider (Santander) to reclaim money from the merchant’s bank where there are certain problems with the purchase of goods or services by a consumer (Mr H). It isn’t a legal right and there’s no guarantee the card provider will be able to recover the money this way. It’s a voluntary scheme and the process must follow the scheme rules. As Mr H’s card was issued under the Mastercard brand, the Mastercard chargeback rules apply here. The scheme rules are written by Mastercard. Santander must follow the rules – which are strict, and time limits apply. If the disputed transaction was fraudulent, such as if Mr H was lied to, there may be a valid path to recover costs under a chargeback. There are specific dispute conditions for a transaction deemed a scam or fraud. But these apply when the payment was unauthorised - as do most of the dispute conditions. The transaction was authorised at the hire company by Chip and Pin entry with Mr H saying he made the payment at the time. So, I understand why Santander didn’t think it was likely Mr H would have made the payment if he wasn’t aware of the amount and what he was paying for. Given the available dispute conditions and scheme rules, I think Santander reached a fair outcome when deciding not to proceed with a chargeback. Even if it had been possible to raise a chargeback, for it to succeed it would have required the provision of the same evidence as for raising a misrepresentation and breach of contract claim under S75 CCA – which Santander did consider. S75 CCA In certain circumstances, S75 CCA allows Mr H to hold Santander liable for a ‘like claim’ for breach of contract or misrepresentation in respect of an agreement with a supplier for goods or services which is funded by a credit card. Breach of contract under S75 CCA Mr H has said he wasn’t given a copy of the insurance policy by T. Without this, I appreciate why Santander would have found it difficult to prove there had been any breach of contract. There is no evidence to show the coverage provided by T wasn’t valid and there’s no reason to believe that had Mr H needed to make a claim the insurer wouldn’t have processed it in accordance with the policy’s terms and conditions. It’s also not possible to say with certainty if the two insurance policies provided identical coverage or if there were any differences. Mr H has also said the hire vehicle was ‘unfit, a death trap and not what I should have had’ - with Mr H explaining he found it difficult and dangerous to drive because all the displayed messages and safety warnings and features including the audio ones reverted to Spanish from English when he first turned the ignition off. Mr H says he wasn’t shown by T when he

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collected the vehicle how to change the settings or turn off the driver aids. We don’t know what caused the settings to revert to Spanish after Mr H first turned off the ignition. But it seems T was willing to fix the problem – although Mr H says T said he’d need to return the vehicle to the place of hire. I’m not sure why T wouldn’t have been able to guide Mr H on what to do by means of a telephone conversation or by emailing the instructions to him. It’s also my understanding the instructions can be found online. Mr H has said T accepts the vehicle wasn’t fit for purpose. Having read the supplied email exchanges between Mr H and T, I think it’s fair to say T offered Mr H a $50 rental certificate due to the delays in them responding to Mr H’s complaint. T did apologise for the condition of the vehicle, but they didn’t clarify what condition they were referring to. What T did say was that all vehicles, ‘should be properly cleaned, serviced and in good mechanical condition before being released for rental’. Based on what I’ve seen, I’m not persuaded T said the vehicle wasn’t fit for purpose. It seems the vehicle was drivable and wasn’t suffering from any mechanical faults. The issue was that Mr H found it difficult to drive because the driver aids reverted to Spanish from English. As such, I appreciate why Santander didn’t think this comprised of a breach of contract under S75 CCA. In the circumstances, I think it was reasonable for Santander to have concluded the evidence didn’t support there had been any breach of the contract Mr H had with T. Misrepresentation under S75 CCA Santander concluded the available evidence wasn’t enough to show there had been any misrepresentation under S75 CCA. I think this was a fair outcome for Santander to have reached. I say this because: • The receipt Mr H has provided only shows he paid a total of €384.55 to T. It doesn’t provide a breakdown of the individual costs. It isn’t clear if this was the amount T charged for the insurance or whether it also included the cost of hiring the vehicle and any other additional items. • Mr H has been unable to provide a copy of the hire agreement - with Mr H saying T didn’t provide it when he collected the hire vehicle. However, it’s my understanding that while under Spanish law the driver doesn’t need to carry a physical copy of the insurance policy while driving, car hire companies must provide proof of insurance within the rental contract, as all rental cars must have mandatory third-party liability coverage. So, it’s unusual that T wouldn’t have required Mr H to sign the rental contract and given him a copy. • There is no audio or video recording of the conversation Mr H held with T. So, it isn’t possible to hear what was said by either party in relation to the sale of the insurance policy. Mr H says he was forced to take T’s insurance as they wouldn’t accept the coverage provided by D’s insurance policy. But we only have Mr H’s testimony about this. I appreciate Mr H says he was tired and had been at the hire place for some time, but potentially he could have written on a piece of paper (as he says he wasn’t given any contract) or the receipt (if enough room) that he objected to the payment and reserved the right to complain and ask for his money back and asked the person he was dealing with to sign it and print their name and job title. In the circumstances, I think it was reasonable for Santander to want to see more to show there had been misrepresentation caused by T demanding payment for their insurance

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rather than them accepting the coverage provided by the insurance Mr H had bought from D and taking a deposit on Mr H’s card. Communication Our Investigator thought Santander ought reasonably to have better explained to Mr H why they weren’t going to raise a chargeback and clarified what sort of additional information they needed from him to enable them to progress the S75 CCA claim. I agree some of the communications Santander issued were poor. But even had Santander been clearer, I’m not persuaded Mr H would have been able to provide any further information that would have led to a different outcome. Based on the available evidence, I consider Santander acted fairly when declining the S75 CCA claim and when deciding not to raise a chargeback. Overall, I think Santander progressed the matter in a timely manner without undue delays. However, for the reasons I’ve explained above, I think Santander ought reasonably to have provided more clarity about what further information may have enabled them to progress the claim. So, I consider a fair resolution to this complaint is for me to instruct Santander to pay to Mr H a distress and inconvenience payment of £50. Charging interest and late payment fees Mr H is unhappy Santander charged interest on the disputed balance and applied late payment fees. In the circumstances, I don’t consider it was unfair for Santander to do so, and I’m satisfied this was in accordance with the terms and conditions of Mr H’s credit card account. So, I’m not going to instruct Santander to refund any of those fees and charges. My final decision My final decision is that I uphold this complaint in part, and direct Santander UK Plc to do as I’ve instructed - as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr H to accept or reject my decision before 28 April 2026. Carl Bibby Ombudsman

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