Microsoft takes money from expired cards - Wikimedia

Some XBox Live subscribers are having a rough time with their payments, claiming that Microsoft is taking funds from expired cards.

Users are also claiming that the money is still coming out of their accounts despite cancelling their subscriptions with the gaming company.

The problem was first bought to our attention by Andrew Davey who noticed that despite having a Gold subscription with Microsoft he was still being charged £5.99 for a previous account under a different email address. What's more the card number that Microsoft was taking the money from had expired in 2009.

He contacted XBox, which informed him that he was unable to get a refund because on its system the card had not expired and the account was still active.

The XBox customer service rep said he could only give Mr Davey a refund  if he can prove that the card had expired. Mr Davey did so through a number of screenshots only to be told that the rep did not have the authority to give him the refund. Compensation to reduce his annoyance was also rejected.

And he's not the only one with the forums filled with people claiming that Microsoft has done the same with their expired cards.

In a case like this it would be simple to blame the bank, but, for once it's not their fault.

We contacted the mobile payments association APACs, which told us that XBox Live customers had set up payments directly with the merchant. These are known as recurring transactions and unlike Direct Debits, which require a sort code and account number, people don't get the same protection if something goes wrong.

A recurring payment is a continuous payment which is used by services, which you may require in an emergency, for example you may set this up with the RAC, which takes the money out even if the card expires to ensure you're still covered. This service is a deal between the provider and the payee, meaning the bank has nothing to do with it.
 
This means that the bank isn't liable because the contract is between the card holder and the merchant - in this case Microsoft. In order to stop payments, a user has to cancel the recurring transaction directly with the merchant as the contract was made independent of the bank.
 
It recommended that readers got in touch with their card provider to see if they could help recover any of the lost funds as well as checking their T&Cs with XBox.

We also called Barclays, Mr Davey's bank, to see what could be done. A representative for the company told us that the matter was out of its hands as the contract wasn't with the bank. He said if people using this payment wanted to cancel, they would have to talk to the provider who would then have to cancel with the bank. However, expired card payments would still go through.

It said that Mr Davey would also have to prove that it had asked XBox to cancel the transaction. If he could and XBox still wasn't playing ball then the bank could step in to help with the dispute. This  would involve filling out a form explaining and showing evidence of the cancellation. The bank would then mediate between XBox and the customer and help push for a refund.

However, he pointed out that if the T&Cs say, for example, that Andrew had to stay with the company for a year and he tried to cancel the transaction in the eighth month, then XBox was in its rights to continue taking out the money.

We contacted Microsoft to find out what was going on. At the time of going to press the company had not responded to repeated inquiries.


* In other news, Steve Ballmer went out of his way today to say that server supremo, Mr Robert Muglia, will leave Microsoft in summer. Bit precipitate, eh?