Hi,

We've been using a so called payment solution provider, to be able to accept VISA/Mastercard, but closed down operations in October last year. After waiting the stipulated 180 days we requested a settlement which, after some "nagging" on our part, finally was realized and paid out on 06/23. So far so good BUT we felt it was way less than the expected. On closer investigation, after getting back access to our history reports which our payment solution provider initially had closed down, they claim to have had a $5.000 review fee assessed by VISA on 06/06, and supposedly this fee/fine came as a result of us having a charge back ratio above 2% for the month of October.

True, our CB ratio was 3.13% for October but I still find this very suspicious because:


this was ONE single charge back for October
over the few months we were active (Feb-Oct 05) we had no more than a total of 3 charge backs for VISA, ie not even close to a CB ratio of 2% in total or for any other month
having this fee assessed by VISA on 06/06, 8 months later and precisely when our settlement was calculated, seems too "convenient" for our payment solution provider I'm aware of these "review fees" existing but despite searching have found no similar cases being reported. Probably for good reason too since if these review fees where common place, and assessed as a rule, my guess is that a huge number of small online business would be affected and effectively would have to close down.

Is this likely a legit charge? Any thoughts? Any experiences?

Thanks in advance!

Pelle

PS Sorry for not disclosing the name of the payment solution provider but I feel I need to do more research before formalizing any accusation or mess with their reputation, so to speak.

Most merchant processing agreements will allow for the service provider to pass along any V/MC fines, fees, financial penalties, etc. incurred due to merchant activity. Its certainly possible that Visa could have fined the provider for an excessive chargeback rate, but the more often the account is simply terminated, funds held, and the merchant is possibly placed on the TMF/MATCH File. For a one month spike like you describe, being fined would seem unlikely. It could be a fine for something other than excessive chargebacks. Calling it a "review fee" might mean your merchant account caused the provider to be audited by Visa, and they are charging you for that.

Thanks Dave!

I'm totally OK with them passing along any legit fees/penalties etc. but since they say that " Your account exceeded the amount of Chargeback ratio for the month of October 2005. A fine has been assessed by Visa." to me implies that my account alone triggered VISA to review or audit. According to VISA's own information (just found), regarding their compliance program, that just would not happen without a warning, on "first offense", and not at all with less than 50 transactions for that month.

My guess is that since the payment solution provider is pooling their merchant accounts this might be an attempt to also "pool" fees/penalities in a creative way...

I'll keep investigating!

Anything is possible, but if the transactions per month were below 50, then I would agree that its doubtful that your account would be attracting enough attention for Visa to fine.

If by "pooling merchant accounts" you mean you were using an aggregated or third party processor, as opposed to a direct merchant account, then all bets are off. They could be charging you for anything.

Sorry, don't know the "lingo" too well but you're right in us having used a third party, and that's what makes this so difficult to follow up on and why all input is very much appreciated. I really make no illusions about getting the $5K back but at least I'll do my best to get to the bottom of this, possibly helping others in the process.

Thanks

My 2 cents here if you want to know = you are being screwed of $5k from your MAP! To get "VISA attention" which would result in "fee assessed by VISA"... oh man... you gotta have at least 3 month of constant excess chargebacks and process I guess somewhere over 100k a month at least. Otherwise, what a NORMAL and HONEST MAP would do is simply close your account, put you in TMF/MATCH and return all your holdbacks after 180 days.

This exact situation cent to cent happend with one of my fellow merchants. As tragic as it is, even he could not say MAP did anything wrong because they simply followed the rules and regulations for such cases, and he got all money back after 180 days.

I suspect your MAP is one of those 3rd party processors who dare to play such games with its customers. I do not think any of decent MAP would even think doing anything like this. So I say, put their name on the table and let everyone know who they are.

Good luck with recovering your money.

Appreciate the 2 cents Leksus :) Having had pretty good communication with them, up until now, I'm giving them a few days more to prove the charge is legit or admit their mistake and make good. I'll get back with more details as soon as I get a reply regardless of how they wanna play this...

Based on what you've posted, Visa would not even be flagging your "individual" account if it is part of an aggregated account. Unless your 3rd party processor is setup as a true IPSP, there wouldn't even be a way for Visa to discern the transactions from "your" account versus aggregated transactions from the 3PP.

While they may have been fined by Visa, it would be as a result of their overall processing activity and aggregate chargebacks. This is of course assuming that my understanding of your situation and their setup is correct - without more details, it is difficult to be 100% certain.

You may also want to check the TOS/AUP that you agreed to with them to see if they even reserved the right to charge those kinds of costs to you. If they are out of business and no longer processing, it could just as easily be a way for them to try to reduce their payment responsibilities to you... sadly enough.

Best of luck resolving the situation either way!

Thanks cdgcommerce and congrats on becoming a dad :)

Yes, as customary we agree in the TOS/AUP to pay fines and fees assessed by VISA/MC incurred by our activitites. However, to be charged under the circumstances we have been is just not acceptable.

I have given them ample time to come up with anything in terms of documentation/proof that the $5.000 charge, claimed to have been assessed by VISA, is accurate but have received no reply. Thus I dare say we are at best the victims of dubious business tactics deployed by a very unprofessional company, or at worst, the victims of an ellaborate and systemized fraud.

Pick one but in either case my recommendation is to stay far away from them and, if you´re already a customer of theirs, take warning! Who they are? Veripayment operating at veripayment.com....

BTW, since I'm not fond of scammers/fraudsters or generally bad companies I welcome suggestions as to where this information could help others avoid being riped off. PM me.

from all my investigation veripayment was looking ok, anyway since your case i'm not sure, please can you email me to shareinfo67@gmail.com and share about good/bad companies you know who working with pharmacies

thanks


Thanks cdgcommerce and congrats on becoming a dad :)

Yes, as customary we agree in the TOS/AUP to pay fines and fees assessed by VISA/MC incurred by our activitites. However, to be charged under the circumstances we have been is just not acceptable.

I have given them ample time to come up with anything in terms of documentation/proof that the $5.000 charge, claimed to have been assessed by VISA, is accurate but have received no reply. Thus I dare say we are at best the victims of dubious business tactics deployed by a very unprofessional company, or at worst, the victims of an ellaborate and systemized fraud.

Pick one but in either case my recommendation is to stay far away from them and, if you´re already a customer of theirs, take warning! Who they are? Veripayment operating at veripayment.com....

BTW, since I'm not fond of scammers/fraudsters or generally bad companies I welcome suggestions as to where this information could help others avoid being riped off. PM me.