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Ecommerce Forum

Solution to Chargebacks Initiated by Fraudulent Advertisers

5+ Year Member

Msg#: 4047274 posted 8:00 pm on Dec 17, 2009 (gmt 0)

Chargebacks are a pain in the butt.

Everyone dreads that email from PayPal (or your gateway) weeks after you've collected payment (and possibly spent it).

To solve it, we've just made a change to our self service ad manager to basically Authorize & Hold the funds at transaction time, then allow the administrator to Charge the advertiser later on.

This does two things -

1) It ensures that you can "Void" the transaction easily if the transaction was made in error.

2) It allows you to build an audit trail with the advertiser, which will help you if a chargeback is filed after the campaign has run.

Legally, you haven't received payment with an "Auth & Hold" so you can't be sent a chargeback.

Anyone else got ideas on how to prevent the evil of chargebacks?


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