Consumer complaint received 2026-03-06 00:00:00
Product: Credit card — General-purpose credit card or charge card
Issue: Problem with a purchase shown on your statement — Credit card company isn't resolving a dispute about a purchase on your statement
Company: Klarna AB
State: TX

Complaint narrative:
I am filing this complaint against Klarna Inc. regarding their failure to properly handle my fraud dispute for a {$750.00} charge from merchant XXXX XXXX XXXX ( XXXX, XXXX / XXXX XXXX, XXXX, TX ). The charge was processed through my Klarna XXXX card ending in XXXX. BACKGROUND : In XX/XX/XXXX, I paid {$1500.00} total ( XXXX payments of {$750.00} ) to XXXX XXXX, operating as XXXX, XXXX ( website : XXXX ), for a custom-made XXXX pinstripe suit. The {$750.00} payment at issue was processed through Klarna on or about XX/XX/XXXX ( Invoice # XXXX ). The merchant advertised bespoke tailoring services, claiming suits were handmade internationally in cities such as XXXX, XXXX, and XXXX using premium fabrics. Text message evidence proves the merchant was simply ordering from an external supplier and reselling not providing custom tailoring as advertised. The merchant never delivered the suit, refused to provide a refund, and has been unresponsive. I filed a police report with the XXXX Police Department ( Report Number : XXXX, Tracking Number : XXXX ), which classifies this as theft of property. Other consumers have posted reviews online describing the same pattern of fraudulent behavior by this merchant. TIMELINE OF DISPUTE WITH KLARNA : XXXX. XX/XX/XXXX : I filed my first dispute with Klarna for the {$750.00} XXXX XXXX XXXX charge. I provided supporting documentation including the police report, text messages proving fraud, payment receipts, and evidence that the suit was never delivered. 2. Between XX/XX/XXXX and XX/XX/XXXX : Klarna automatically canceled my first dispute without any notice, explanation, or written communication to me. I was never informed of this cancellation until I followed up. 3. XXXX XXXX XXXX : After discovering the first dispute had been unilaterally canceled, I filed a second dispute. Klarna confirmed the second dispute was opened as of XX/XX/XXXX. XXXX. XX/XX/XXXX ( XXXX XXXX with XXXX XXXX ) : I contacted Klarna live support to get an update. During this chat, the agent confirmed : ( a ) the first dispute was filed XX/XX/XXXX ; ( b ) the first dispute was " automatically canceled '' by Klarna ; ( c ) a new dispute was opened XX/XX/XXXX ; and ( d ) the agent could not provide any documentation showing the specific reason for the first dispute 's cancellation. When I pressed for a reason, the only explanation given was that " the merchant did not close the dispute in your favor and there was no information. '' The agent then attempted to end the chat without resolving my concerns. SPECIFIC ISSUES : 1. Unauthorized Cancellation of Consumer Dispute : Klarna unilaterally canceled my first dispute without my knowledge or consent. I never withdrew, canceled, or changed my position on this dispute. As a financial services provider processing credit transactions, Klarna has an obligation to properly investigate consumer disputes and provide written notification of outcomes. Canceling a dispute " automatically '' without communicating the reason or result to the consumer is a potential violation of the Electronic Fund Transfer Act ( EFTA ), Regulation E, and fair billing practices under the Truth in Lending Act ( TILA ) and Regulation Z. 2. Failure to Provide Written Notice of Dispute Resolution : Klarna never sent me any written communication by email, letter, or in-app notification informing me that my first dispute had been closed, denied, or canceled. Under applicable federal regulations, financial institutions are required to provide consumers with written notice of the results of a dispute investigation, including the reasons for the determination. Klarna failed to do so. XXXX. Inadequate Dispute Investigation : Despite being provided with substantial evidence of fraud including a XXXX Police Department incident report ( Report # XXXX ), text messages proving the merchant never intended to deliver the advertised services, and proof of payment Klarna appears to have either not conducted a thorough investigation or sided with the merchant without reviewing the evidence. The fact that the dispute was " automatically canceled '' suggests a systemic or procedural failure rather than a substantive review. 4. Agent Unable to Provide Resolution or Documentation : During the XX/XX/XXXX live chat, Agent XXXX was unable to provide any documentation explaining why the first dispute was canceled, could not offer any escalation path, and repeatedly attempted to end the conversation without resolving the issue. DESIRED RESOLUTION : 1. Full refund/chargeback of {$750.00} for the fraudulent XXXX XXXX XXXX transaction. 2. Written explanation of why my first dispute ( filed XX/XX/XXXX ) was " automatically canceled '' without notice, and what investigation steps were taken before closure. 3. Confirmation that the second dispute ( opened XX/XX/XXXX ) will be properly investigated with a written determination provided to me regardless of outcome. 4. Review of Klarna 's dispute handling procedures to ensure consumers are not having disputes automatically canceled without notification, as this practice may constitute a systemic unfair, deceptive, or abusive act or practice ( UDAAP ). SUPPORTING DOCUMENTATION AVAILABLE : - XXXX Police Department Summary Incident Report ( Report # XXXX ) - Klarna live chat transcript with Agent XXXX ( XX/XX/XXXX screenshots ) - XXXX payment receipt Invoice # XXXX ( {$750.00}, XX/XX/XXXX ) - Transaction detail showing XXXX XXXX XXXX charge on Klarna XXXX ending XXXX XXXX Text message thread with merchant proving fraudulent intent and non-delivery - Negative consumer reviews from other victims of XXXX - Website screenshots from XXXX showing false advertising claims

Company response to consumer: Closed with explanation