Hello fellow WHTs,

Well, it happaned to us. We've provided programming service to customer and he made chargeback after 3 months, no reason. 2checkout is used for this CC order, so there is no way we can win this (or not?).

We want to keep such steeling customers away from and we are looking at other ways of setting up payments.

Please can you tell me what is the best method of collecting money after service is provided without charback (maybe we can make order out of it):

- Paying directly to Bank Account
- Paying via Merchant Account
- Paying via PayPal
- Paying via 2checkout
- other?


TIA

paying by wire transfer
western union
money gram
egold

Basically, slower payment process == smaller chargeback possibility

I personally like E-checks. I found a local provider who works with a lot of professional offices (think denists who want to do payment plans). The costs were fixed and insanely cheap. (Fixed rate per E-Check, less than $1 no matter how much the check was for.)

If there's going to be an issue with an ACH/EFT it's going to show up with in a week. Of course the issue you have is if the check bounces you'll get hit with fees. (Usually about $3-5 for a NSF.)

Nothing is foolproof when it comes to chargebacks on credit card sales, but if you want to minimize them, you might try a direct merchant account with a provider that supports Verified by Visa and MasterCard SecureCode. They are designed to both reduce chargebacks and reduce chargeback liability by shifting it to the issuing bank.

The best thing to do is use a real merchant account and then obtain full WRITTEN documentation and contract details with your customers.

You can contest a chargeback easily if you have these details:

1) Signed contract that explains exactly what is being purchased and how it will be delivered and "approved" by the buyer.

2) Signed "acceptance of delivery" by the customer.

3) Proof of customer signature, like copy of their credit card with a signature on an invoice with the full charge amount, etc...

Basically, what you need is paperwork to PROVE to the credit card company that you did in fact have full authorization to charge their card, and that you did in fact deliver what was promised.

2checkout and paypal can never do this, because they will simply pass the chargeback fees to you since they don't have the time or desire to try and fight a chargeback.

Do not give up right on! First, call or write 2CO and REQUEST from them CHARGEBACK REASON and its code. Find out if your moron customer claimed it as fraudulent ("I did not do it") OR other reason(s) such as "product delivered not as advertised", "services not rendered", etc. Build your defense based on chargeback reason.

If customer claims fraud, you should have his info such as IP, e-mail and mailing addresses in your records. However, if he gave you free e-mail, used proxy IP, and he lives outside of US, then you are most likely out of luck and I must say partially this would be your fault in accepting such transaction.

If there is another than fraud reason, then you need to analyze what happened and see if you can fix that.

Moving to VbV/MCSC is the only way to save yourself from fraudulent chargebacks, especially from "family/friendly fraud" because there is no other fraud scrubbing system in the world except of VbV/MCSC that would catch it.

Get a real check, once it's clear, it's clear.

Take cash - 100% chargeback proof option in addition to Western Union, Checks and Money Orders

Having a real merchant account is a good step, but it's not foolproof. I've found that even when you have a solid contract with the customer the aquring bank can always fall back to the fine print in the contract.

In addition, it's not unusual to find that there are research fees associated with fighting a charge back. Those fees could exceed the actual loss.

If enough money is on the line it's not unheard of to take the customer to court. That of course depends on if you can actually find the person to sue, as well as the bank account to put a lein on.

In very rare cases will the card company go after the customer. The most recent case I can think of is a business man in New York that ran up $241K at a strip club. The case settled out of court for an undisclosed sum of money back in March.

Do not give up right on! First, call or write 2CO and REQUEST from them CHARGEBACK REASON and its code. Find out if your moron customer claimed it as fraudulent ("I did not do it") OR other reason(s) such as "product delivered not as advertised", "services not rendered", etc. Build your defense based on chargeback reason.

Hi Leksus,

This is not fraud. I know this customer for long time and he is located in US, IP is from US (non proxy), address is US. Email is from GMail.


Moving to VbV/MCSC is the only way to save yourself from fraudulent chargebacks, especially from "family/friendly fraud" because there is no other fraud scrubbing system in the world except of VbV/MCSC that would catch it.
This is case when customer did get the service, and after three months decided that he want his money back b/c he is not going to be online anymore, retiring from the business, so he decided to take back money (!?). I was shocked when I saw the chargeback email from 2checkout (first one in nearly 3 years).

And yes, I will ask 2co what is the reason (uknown reason specified) in Sale overview.

Thanks.

Just got this from 2checkout:

"AMEX is the one credit card that we have no challenge rights with. If there is no
contact with the customer there will be no resolution to this dispute. Sorry
for the inconvenience."

Customer is ignoring my emails, as you might suspect.
Bottom line: I do not have any tools/means to fight for justice

You will be surprised how many "regular and known" customers file chargebacks based on "unauthorized"/"fraudulent" reason. It is just easy for them to say "I did not do it" than explain why exactly they decided to get their money back.

However with AMEX I’m afraid you are out of luck. I do not even know if AMEX has any reason codes for chargebacks at all. I was sure you deal with either Visa or MC. Sh** happens, that’s all I can say. My suggestion is just to move on. Good luck.

2checkout and paypal can never do this, because they will simply pass the chargeback fees to you since they don't have the time or desire to try and fight a chargeback.

That's a little harsh. Not only does PayPal dispute chargebacks on your behalf, they ask you to provide anything you can to assist in the dispute, and in my experience, they often win. Even when I never expected a positive outcome, like a customer in the middle east claiming the transaction was fraud, where I had no signature or other hard proof I delivered services other than e-mails between me and the customer, they successfully won the dispute and I kept the money.

wow, 2co sucks.

wow, 2co sucks.
Why is it 2Co's fault that a customer did a fraudulent chargeback...do you know how hard it is to dispute a chargeback with AmEx?

Is there any database of customer-who-did-fradulent-chargeback?

So we can protect ourself.

Is there any database of customer-who-did-fradulent-chargeback?

So we can protect ourself.
Not a chance. The legal implecations of having a public database like that would be crazy.

:peace:

Not a chance. The legal implecations of having a public database like that would be crazy.

:peace:

Actually, many exist. CDGCommerce provides instant fraud alerts whenever someone who's performed a chargeback against any of their customers makes a purchase.

More databases of chargebacks and fraudulent customers:
http://chargebackbureau.org/
http://www.chargebackprotection.org

The problem with that is that not all chargebacks are fraudulent.

paypal isnt too bad. They've won/aborbed at least half of all my chargebacks.

Since PayPal is it's own Aquiring Bank they have a much stronger position than other Internet pay sites. They don't get slapped with $100/hr research fees for charge backs.

<<< We use>>> "Paily" for our "high risk" transactions, especially our oversees transactions. The rates a re a little bit higher, but there are no chargebacks.
www.paily.com (http://www.paily.com)

If you state that you forward all disputed accounts to collections, forward his account if it's of high enough value. You could get his money back if he doesn't want a mark on his credit history.

Keeping a database that refelects the credit or good name of a US citizen, as a US based business could make a whole lot of Credit Reporting Agency (CRA) rules apply to you.

I'm lucky enough to be in a low risk business. I've never had a charge back. But as I expand, I see increased risk. Companies that do fraud scores based on address, information from the credit card, etc, seem to be pretty cheap.

paypal isnt too bad. They've won/aborbed at least half of all my chargebacks.

People can't chargeback you for web hosting services with PayPal. We've won every dispute brought against our account (except in cases where a PayPal account was stolen to make a purchase) because PayPal' buyer protection policy does not include service-based non-tangible items.

People can't chargeback you for web hosting services with PayPal.

You're confusing Buyer Disputes with Chargebacks. Chargebacks are made outside the PayPal system for credit card payments and PP will pass it through to you until the dispute is won or lost with the card issuing bank.

paypal isnt too bad. They've won/aborbed at least half of all my chargebacks.

Last I heard, PayPal just dismisses the "disputes" if it's service related, because they have no clue as to what went on, as in, it wasn't an actual product shipped from eBay or something.

I may have heard wrong.