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Q: Credit card charge-back ( No Answer,   7 Comments )
Subject: Credit card charge-back
Category: Business and Money
Asked by: dgp-ga
List Price: $50.00
Posted: 13 Jul 2004 07:10 PDT
Expires: 15 Jul 2004 11:58 PDT
Question ID: 373438
We are a small company based in Richmond, Virginia that sells a
specialized measuring device. About 3 months ago we were called by a
person from Sacramento, California who had seen our product and wanted
to purchase one. He wanted to use two credit cards and the
transactions for $10,000 and $7,000 were approved by Chase Merchant
who provide our service.

Some 2 months later the "customer" called us and said that he no
longer wanted the product and wished to return it for a full refund.
We explained that he had bought the product and if it was faulty we
would exchange it but that was all. (The average charge for the test
that this machine does is $250 so it is possible for someone to
conduct 100 tests, make $25,000 and then try to get a full refund). He
then informed us that he was going to call his credit card companies.

Two days later $10,000 was taken from our bank account followed the
next day by $7,000. After many phone calls to Chase Merchant we were
sent rebuttal forms that we completed and returned. The outcome is
that the charge back for $10,000 from one card was reversed (but he
has the right to appeal) but the other card company ruled in his favor
and we have no right of appeal. So we are $7,000 down and he still has
the equipment.

Chase Merchant are sympathetic but have no solution as they "must
follow the guidelines of the issuing credit card".

The questions are, is it really right that anyone can change their
mind about a purchase and simply demand their money back. With the
plethora of consumer protection laws in place is there no protection
for the merchant?
There is no answer at this time.

Subject: Re: Credit card charge-back
From: probonopublico-ga on 13 Jul 2004 07:17 PDT
It happens!

A buyer using a CC often gets 'purchase protection' which can have the
effect that you have experienced.

Like you, I had to find out the hard way and I had to swallow a similar loss.
Subject: Re: Credit card charge-back
From: corwin02-ga on 13 Jul 2004 07:44 PDT
All you can do at this point is start legal action to get the device
back since the customer did not pay in full (repo services and the
like) other then that there is not much you can do
Subject: Re: Credit card charge-back
From: dgp-ga on 13 Jul 2004 07:50 PDT
As a long time reader of these answers I have always admired your
amusing bon motes and your report with the researchers but that
comment wasn't amusing. Help me out. I'm dying out here, make me smile
Subject: Re: Credit card charge-back
From: nfpolaris-ga on 13 Jul 2004 09:14 PDT
In order to cover ourselves we ALWAYS make a client sign a charge
form..which states the terms of refunds or credits, BEFORE we deliver
the product.  Takes a bit more time and hassles to not be able to just
take a cc over the phone...but saves us immensely in the longrun.  If
there is some sort of problem & we get a chargeback...we simply send
the credit card company a copy of what he signed which states our
terms....has always worked.
Subject: Re: Credit card charge-back
From: probonopublico-ga on 13 Jul 2004 09:59 PDT
Sorry, dgp, but it's a bloody serious problem and I feel for you.

It's so annoying when you place your trust in someone and they let you down.

Fortunately, it doesn't happen very often in my experience.

Maybe this character is reading this now and maybe his conscience is
troubling him and, if so, I ask him .... 'Please make dgp smile!'

Let's see if that does the trick. Who knows?

Cheer up

Subject: Re: Credit card charge-back
From: dgp-ga on 13 Jul 2004 10:27 PDT
To corwin02-ga, thank you but I have a bad, bad feeling that using the
legal system will only result in more misery.
To nfpolaris-ga, yes that is what Chase Merchant also told us so good
advice. We also put a gateway page to our on line store so you have to
read the terms and click "agree" before you get to the catalog.
To Bryan, yes it is serious but not as serious as being hit by a truck
so keeping things in perspective I am older wiser and somewhat sadder.
Anyway thanks for you nice thought.
To anyone else, please feel free to comment. If a researcher would
like to find some brilliant piece of legislation that forces people to
act in an honorable manner there is still $50 up for grabs
Subject: Re: Credit card charge-back
From: larre-ga on 13 Jul 2004 11:40 PDT
dgp -- There IS legislation (State Commercial Codes) which define
commercial relationships between buyers and sellers, and spell out
what is allowed, what is not allowed. These, however, are not criminal
statutes, they are civil laws, and therefore enforceable through the
courts (in a lawsuits), rather than by arrest or just "saying so".

I'll be glad to research New York's commercial codes, outline options.
However, you'd be better served by a referral from your local bar
association to an attorney who specilizes in collections. If you've
"won" one of the chargeback appeals, then there is money owed your
business, and there are established means to collect it.


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