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Dealing with chargebacks

     
3:19 am on Nov 13, 2018 (gmt 0)

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After putting many of our biz to biz payments through Paypal for many years and having maybe 3 BS charge-back attempts (which we all won in short time)... Our new eComm we've been on for just a few months, already has our first charge-back with a "fraudulent" claim. I talked to the guy pre sale and he used an email address with his name on it. I looked him up and found info showing he graduated in the town of the shipping address, and also found online info showing he's associated with the delivery address. I've sent him an email asking what happened with no reply. Normally if this was PP I'd think I'd have about 95% chance of getting this reversed quickly. Unfortunately I searched around though, and it would appear people lose a lot of charge-backs through this eComm. Not sure why they would matter since it's obviously the bank/card provider that makes the decision. Even though the eComm itself said the fraud risk was low on the order, I have this gut feeling they'll not return the money (which is substantial). What else can I do if that happens? This went USPS. Can I do something with his local PO and the postal inspectors?
4:51 am on Nov 13, 2018 (gmt 0)

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Your USPS tracking numbers can prove you shipped and prove it was delivered. If you did not also use Signature Confirmation you can't prove they received it - but the tracking number shows whether it was picked up at the PO by the addressee after a notification. They can also show whether it was received at home delivery or left on a porch or mailbox.

The charge-back is a claim that they did not order the item or that it was not ordered by the cardholder or that the item was not received. Without knowing what they are claiming you may have a hard time proving your side of the case.

I learned a long time ago (when I was shipping large and somewhat expensive items) to always use Signature Confirmation and only ship to the billing address.
7:50 am on Nov 13, 2018 (gmt 0)

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Oh it definitely went to the billings address and I verified his connection with that address. He's claiming "fraudulent", meaning that somehow it was unauthorized card use. Which is ridiculous because it was his card and it went to his verified address. So it would have to be somebody with access to his house, using his email address, and his card. I have delivery verification. At the very least, somebody there should send it back, but they refuse to communicate now. Sometimes wives will see something and do a charge-back, but the refusal to communicate now would seem to indicate a scam. So as I said, you would think this is a slam dunk in my favor, but I've seen people say they've still lost under these circumstances. Not to mention, the eComm said it could take 72 days for the bank to decide? That seems absurd. Most we've ever waited in the past was a week.
9:38 am on Nov 13, 2018 (gmt 0)

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He's claiming "fraudulent", meaning that somehow it was unauthorized card use.


A payment gateway I've used in the past (Wirecard) indicated to us you'll pretty much lose chargebacks unless your customer either used 3-d secure or you have a photo of the front and back of their card, though we sold an intangible product. Invoices, logging, communications didn't count for anything. This seemed to place responsibility of unauthorised use on the customer instead of you.

Perhaps your payment processor can provide further details on whether those options would help you with future customers. Probably isn't good for conversion rates and IIRC 3-d secure meant slightly higher payment fees, but it may give you peace of mind
6:19 pm on Nov 13, 2018 (gmt 0)

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I'll have to see how often it happens. It may just be a coincidence that this happened just a few months after we switched to the new platform. But yeah, it would seem many providers/banks choose to make themselves complicit in basically helping their customers steal stuff. To rub salt in, the eComm platform added a $15 fee on top of it. They claim that's because the provider charges them something. Which still makes no sense at all. So even if it was legit... Say, dude leaves his wallet in a restroom. Person takes it, buys stuff with the card. Then he claims "fraudulent". Then because some guy left his wallet in the #*$!ter, everybody that the criminal bought stuff from and their eComm platform gets charged a fine, while they already lost the sale money? WTF. Why would WE be fined for somebody else losing their wallet?
5:40 pm on Nov 14, 2018 (gmt 0)

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To rub salt in, the eComm platform added a $15 fee on top of it. They claim that's because the provider charges them something. Which still makes no sense at all.
This is typical in the real (non-Paypal) world of cc processing. In many cases, that fee is non-refundable, even if you eventually win the chargeback.

He's claiming "fraudulent", meaning that somehow it was unauthorized card use.
There are any number of scenarios where this can be true. The spouse made the order without the card owner's knowledge (or consent). Or the cardholder's kid. Or someone stole the CC info and placed an order to test the card. Or someone stole the CC info, placed an order, and is working with a crew to intercept the package from being delivered (or stealing form the front porch).

And of course, the customer could be lying and/or just too lazy to return the item through the normal process.

I talked to the guy pre sale and he used an email address with his name on it.
Do you mean you actually talked to him verbally by calling a number that you verified through public records? Or that he called you (with a caller ID number that can be spoofed easily)? Or that you communication through e-mail and he used an address like RealCustomerName at yahoo or RealCustomername256 at gmail?

Why would WE be fined for somebody else losing their wallet?
Because none of us are a billion dollar industry that can afford to hire lobbyists and make the rules.
8:37 am on Nov 15, 2018 (gmt 0)

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No I just had an exchange with him with email, and the email address had his name in it. Obviously anybody can do that, but we don't sell the type of products that people would typically go to those kinds of lengths to scam, and the questions he asked were legitimate questions. Also, the product would be hard to hide from a family, because ti would be in plain view. And the property is a farm in the middle of nowhere. seems like a lot to go through for a random thief.

Any way you look at it, it's BS. Let's say it was their kid. Oh look honey, Jr. bought something with our credit card. So then they tell the bank that. Then bank says what? 'Oh, OK no problem, we'll get your money back for you because you're kid committed card fraud, and don't worry... you guys just keep the product. Don't bother sending it back. We gotcha covered.' That basically makes the bank complicit in helping their kid steal stuff.
11:40 am on Nov 16, 2018 (gmt 0)

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Or did the wife see the CC bill for the present bought for the mistress?
8:06 pm on Nov 16, 2018 (gmt 0)

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lol No woman would want what we sell.
2:04 am on Dec 18, 2018 (gmt 0)

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One question: What business name shows on the customer's card statement?

I currently manage an ecommerce website for a client that utilizes a specialized ticketing software. Unfortunately, since the software company processes CC on their end, the customer's statement does not show the website name. Even though there are many notices about how it will appear on their statement ("WidgetTickets"), we still get a chargeback every couple of months.

Most of the time it is handle by calling the customer to inquire, explaining the situation, convincing them it was legit and getting them to release the chargeback with their CC company/bank.
2:08 am on Dec 25, 2018 (gmt 0)

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It shows our full name (same name as site/biz). Not much room for confusion.

I emailed the guy on the same address he used to talk to me with product questions before purchasing, 3 times, and now get no response. It's a guaranteed deliberate scam.