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An Interesting Chargeback Twist
What if anything should I do?

10+ Year Member

Msg#: 3551524 posted 9:44 am on Jan 18, 2008 (gmt 0)

Ok so we had an order back in Nov of last year that had different "bill to" and "ship to" addresses.

When the order was processed, the "bill to" address was an AVS match.

Because of the different "billto"/"ship to" and other reasons, the order was shipped signature required.

About a month later we got a possible chargeback notice from our merchant account provider. The card holders statement to their card issuer was that they did not recognize the charge. We provided our merchant account holder with all the documentation we had, including a copy of the signature gathered at the time of delivery by our carrier (Actually it was two because the order shipped in two parcels)

Based on past experience, I figured we would probably win the case because it was probably just a matter of the customer not remembering making the purchase, but there was also the possible that we might lose because of the different "bill to and "ship to" address.

About two weeks later, we got a notice stating that the matter had been resolved in our favor from our merchant account provider. But the notice also states that the resolution might be temporary should the card issuer or card holder continue to dispute the charge.

Fast Forward.................

Today I received an e-mail through our general customer service e-mail address from this customer (from an e-mail address different then the one in our files) claiming that he did not order the stuff and is the victim of fraud. He provides his telephone number (doesn't match anything in our records)and He also claims that he needs to either follow up on this matter with his credit card issuer or file legal proceedings.

So I'm wondering, what do you folks think we should do?



5+ Year Member

Msg#: 3551524 posted 2:23 pm on Jan 18, 2008 (gmt 0)

It sounds like it was probably a fraudulent order (or the customer is trying to scam you). Either way, you will NOT win the chargeback because the order was not shipped to the billing address.

Your in a tough position, either refund the customer (lose the money and the merchandise) or wait to see what the outcome of the chargeback will ultimately be.

Once again, this is a lesson for ebusinesses. NEVER ship to an address other than the billing address of the credit card. We adopted this policy several years ago and it had ZERO effect on orders.


10+ Year Member

Msg#: 3551524 posted 2:44 pm on Jan 18, 2008 (gmt 0)

I'd start by calling the customer and calmly discussing the situation with them. How much was the order for?


WebmasterWorld Senior Member 10+ Year Member

Msg#: 3551524 posted 4:12 pm on Jan 18, 2008 (gmt 0)

NEVER ship to an address other than the billing address of the credit card. We adopted this policy several years ago and it had ZERO effect on orders

How would you know it had zero effect?

Last time I looked, about 10-15% of our orders go to separate addresses. We haven't had a cent of loss in years. Should stress that our products are low risk.

I'd start by calling the customer and calmly discussing the situation with them. How much was the order for?

Yes, very good advice and good question. Large order size is a key indication of fraud.


WebmasterWorld Senior Member 10+ Year Member

Msg#: 3551524 posted 4:27 pm on Jan 18, 2008 (gmt 0)

NEVER ship to an address other than the billing address of the credit card.

'twould rule us out from ordering from you.

Rural area, no mail delivery. PO Box is in a different town/zip from physical address.

It is a constant headache. We have to be very clear on shipping carrier. USPS to PO Box. All else to physical address.

We tend to go back to the vendors that can get this right!


WebmasterWorld Administrator lifeinasia us a WebmasterWorld Top Contributor of All Time 5+ Year Member Top Contributors Of The Month

Msg#: 3551524 posted 4:31 pm on Jan 18, 2008 (gmt 0)

It may not work, but ask him to write you a snal mail stating that he never received nor ordered the items and sign it. Compare that signature against the one you have for the deliveries.

If they're not even close, then it's most likely fraud. However, even if they are close, it's still going to be tough for you to "prove" it.


5+ Year Member

Msg#: 3551524 posted 1:48 am on Jan 19, 2008 (gmt 0)

Yeah, I'd try discussing it with the purchaser...but frankly, if they continue to dispute it, you aren't going to win.
We always start suspicious of different addresses. Things that can lower your risk:
Are the two addresses physically close (same state, etc) - many people have things shipped to their work address
Is the addressee the same person or different
If different, same last name? Lots of gifts are between family members
What email and phone were the order submitted with? If it's bill to person A, ship to person B, and the email was personA@provider.com, and the phone number area code matches the billing address, great.
Also, if you collect IP addresses, check that out too. These can be spoofed but in our experience, that's more trouble than many card fraudsters think to go to...

But long story short, if Person A says they don't know Person B and didn't authorize the charge, and you shipped to Person B, you really can't win.


Msg#: 3551524 posted 7:51 am on Jan 19, 2008 (gmt 0)

you will NOT win the chargeback because the order was not shipped to the billing address

WRONG. If the shipping address was noted on the authorization it is just as valid as the billing address with a signature.


10+ Year Member

Msg#: 3551524 posted 2:48 pm on Jan 19, 2008 (gmt 0)

To answer the couple of the questions people have asked.

The order is not realitively large. A couple of hundred dollars is all,not for multiple of the same item, all items are complimentary to each other and the name for the shipping address is the same as the billing address.

The billing and shipping addresses are different states, but this is not uncommon because many of our customers can be college students having it shipped to them at college rather than at home OR people that are most likely retired and therefore spend winters in resort states and have the items shipped to them there.

As far as allowing or not allowing different "bill to" and "ship to". We have always allowed this and probably see this on 25% of our orders, so changing policy and not allowing it would result in a decrease of sales by some %. Considering that our chargeback rate runs at about 0.10% annually, I doubt we could justify the change.

For obvious reasons, it would be great if all internet merchants were to universally adopt a policy of only allowing shipping to the bill to address, but I don't ever see that happening.

As for whether or not we would win this chargeback if the customer continues to contest it, I highly doubt it. I have lost chargebacks were I had everything but a picture of the customer signing for the package and still lost it. As long as the customer is steadfast in asserting that they did not authorize the charge, you will lose everytime. There is not any motivating reason for the card companies to side with a merchant.


10+ Year Member

Msg#: 3551524 posted 9:17 pm on Jan 19, 2008 (gmt 0)

There are always a few complete head scratchers. We've had a couple of chargebacks for orders of software that anyone could have downloaded from their favourite torrent site without any problems.

Is the chargeback a genuine mistake? Or someone trying to claim a small amount by lying to their card issuer? Or a fraudster with the sophistication to make an order look legit but willing to go through the hassle of mail-order fraud to gain a product which has an effective resale value of zero?

It makes no sense but it does seem to happen from time to time.


Msg#: 3551524 posted 3:56 am on Jan 22, 2008 (gmt 0)

If they are calling you at all after doing a chargeback, this means that they have no more recourse as far as charging back from the credit card company is concerned. People just dont call and become reasonable and want to negotiate after taking it the chargeback route.

Someone tried something similar to this legal stuff with us. An item was returned damaged and we took photos and refused to issue a refund (This was a very expensive item). They were given the option of having the damaged item picked up if they wanted. They then tried a chargeback and we sent the photos to the credit card company and had the chargeback reversed. We had a written email from them that they had returned the item which we sent in also, so there was no chance of them getting off on a technicality such as there not being a delivery signature and so forth.

Later we received a letter from an attorney about a lawsuit. Actually, it was probably close to 6-8 months later. It said to do a refund or ship back the item. We just simply did not respond. If you have an iron clad case why worry? I guess flying out there to defend ourselves would have been costly. Fortunately the law has thought of this also. From what I have heard, someone cannot sue from a far off area and make you travel there, unless the sale was negotiated in their home state. They would have to come to where your business is and file there.

Never heard from them again, but the photos of the damaged item have been filed away just in case.

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