I am sitting here, a little pissed today.

I received an e-mail from CDG risk dept, informing me that there was a new chargeback on account, blah blah blah... ok, so I check the chargeback defender (the place where they list your active chargebacks) to see who might have done it.

And I notice that the chargeback, is from an order that was cancelled due to FRAUD detected by us.

Too bad that the transaction went thru and settled with the system. Next day, we issued a 100% CREDIT on the credit card used on that transaction, leaving us with (-$1.00 or so) from the fees of settlement, credit, etc.

I thought that since credit was issued and the card-holder practically received a refund, we wouldn't receive a chargeback.

Well, today it seems like I was wrong, or at least that the RISK department does not check for CREDITS made to that transaction.

I saw a thread like this one some time ago, with the same provider. I hope they do not charge the $25 fee for something that was refunded the NEXT settlement day of the original transaction.

Thanks for hearing my rant on chargebacks today, have a nice day.

Francisco,
Unfortunately, I believe the $25 fee is charged by the bank and not CDGCommerce (I could be wrong). But in this case, the bank should see the reversal and not charge you. Want to take a bet on what happens?

That is the specific reason that I have my Authorize.net account setup to authorize but not capture the transaction. It requires me to manually capture the transaction which is a pain, but eliminated those chargeback issues.

Good luck...

Well the issuing bank charges the fee to the acquiring bank who charges the fee to the merchant account processor who charges the fee to the merchant (basically).

You might want to consider vetting accounts instead. It might costs a few more cents but well worth it in the long run.

Originally posted by Corey Bryant

You might want to consider vetting accounts instead. It might costs a few more cents but well worth it in the long run.

Thanks for the explanation. You mean to Authorize each transaction as Dacsoft said, and then Capture the funds?

It would be a real pain, I will see if Modernbill can do that to new orders only.

Originally posted by Francisco
Thanks for the explanation. You mean to Authorize each transaction as Dacsoft said, and then Capture the funds?

It would be a real pain, I will see if Modernbill can do that to new orders only.
It really is a pain. But after having 4 separate domain purchases on the same day - all with stolen credit cards, I decided it was worth it. Besides paying for 4 domains that I didn't want, I was charged the $25 for each purchases.

Originally posted by Dacsoft
Francisco,
Unfortunately, I believe the $25 fee is charged by the bank and not CDGCommerce (I could be wrong). But in this case, the bank should see the reversal and not charge you. Want to take a bet on what happens?


Maybe the bank charges them, but still. Heck, even on the chargeback list it shows the refund ID. :angry: ... Still charged the $30 though.

I will see what this ends up being like. Depending on the outcome I might change some policies of billing and TOS.

Thank you guys

It is normal situation. Due to VISA/MC rules when the refund and the chargeback meet each other in banking networks , then the refund becomes the chargeback unfortunately. So, you were the victim of the rule.

Originally posted by Francisco
Thanks for the explanation. You mean to Authorize each transaction as Dacsoft said, and then Capture the funds?

It would be a real pain, I will see if Modernbill can do that to new orders only.
Yes, for our hosting clients, we do a pre-auth. Once we have verified the account and we are certain that account, hosting, etc are not fraud related, we go into use the LinkPoint API and do a post-authorization / sale to complete the transaction.

Takes a little more work but well worth it to prevent chargebacks and fraudulent / spamming accounts.

I would definitely recommend reviewing all your sales first also. This has saved me hundred of times. I do not lose my products or money by taking a few minutes and reviewing each order. If my gut tells me something, I listen to it.

Originally posted by thetopguy
I would definitely recommend reviewing all your sales first also. This has saved me hundred of times. I do not lose my products or money by taking a few minutes and reviewing each order. If my gut tells me something, I listen to it.

I do this personally, everytime a new order comes in, the problem is that this order slipped thru and settled before I could have voided the transaction.

After the settlement, I made a credit to that credit card, and settled 9 hours after. (aka next day)