AMEX Fraud

You can't even challenge it?

[mquarles]

I just set up a new merchant account with AMEX and got two copies of a letter that said that if a customer disputes a charge claiming fraud, that I would receive an immediate chargeback with NO OPPORTUNITY TO CHALLENGE IT.

I have many accounts and have never noticed this before, so I called them. The rep on the phone told me that this was a policy for all merchants in certain categories, including Internet merchants. She said that it is applicable to all existing and new accounts.

Even worse, she said that AMEX will not provide me with any of the customer's details, copies of their challenge, or anything.

Is this new, or have I been missing something? Is this an opportunity for AMEX customers to rip off merchants at will? Just place an order, say it was fraud . . . and your order is free.

MQ

[Essex_boy]

This sounds about right for AMEX - I have comeacross this before.

The whole point being is that AMEX customers are a cut above the rest, according to their marketing, so wouldnt tell lies......

I used to have an AMEX card - dont bother.

[CernyM]

On the other hand, at least for my site, their hype about how Amex card users spend more on average than other card holders has been true.

The average purchase of Amex cardholders on my site has been over 20% higher than Visa or MC holders. (Amex cardholders also return items with a higher frequency than Visa/MC holders, interestingly enough.)

Its unknowable, to me at least, how many sales I would actually lose if I stopped accepting Amex. I imagine most Amex users also carry one of the other major brands.

I imagine that Amex will cancel the cards of members who chargeback purchases with any frequency. Fraud is a major hassle for everyone involved.

[fabfurs]

CernyM - Do you have AMEX Chargebacks on a greater ratio also?

All clients that request AMEX on our site and are told that we can only offer VISA or MC have no problem with using another card.

[CernyM]

Amex chargebacks to date haven't been an issue.

Amex declines during checkout occur significantly less frequently than VISA/MC though.

[fabfurs]

That's interesting, are you doing big ticket items. We are and have been considering AMEX due to the number of request we get.

[CernyM]

No, we deal in ~$40 items mostly.

[mbennie]

I was surprised the first time I ran across AMEX's policy also.

We had 2 chargebacks because the people didn't recognize the charge on their statement. No notice from AMEX. Just happened to run across it while in their online merchant admin.

AMEX customer service told me that all I could do was to contact the people directly and request another form of payment - but not AMEX again.

Fortunately both were honest people who really didn't put our company name to the purchase. They both happily gave a Visa to pay for their purchase.

I am watching this very closely because it has such disastrous potential. If it begins to get out of hand we'll stop accepting AMEX entirely - at a great loss because we are in the travel industry and AMEX is the card of choice.

[CernyM]

I'd be scared to death of the policy if I were selling big ticket items.

But, the risk on the types of products I sell is low to begin with, and the amount I could lose on any given transaction is low enough that I'll keep Amex unless and until chargebacks become an issue.

I wonder if they move to a less hamhanded approach with online vendors that have a longer track record with them?