Credit Card Chargebacks - The Real Scoop

Unknown

evil panda wrote:

I don't disagree with any of the above. Other than I'm honestly not aware of the transactional fee that you refer to, but that's not material to the core argument anyway

I just want to clarify that I bring up diminution of value only as a way of proving good faith - i.e. I believe banks would not suspect bad faith on the part of the consumer because the consumer will tell them, I paid for OP Xforce and got bagforce instead. No receiving agent would immediately call foul on that request. They'll at least open an investigation to see what was promised vs what was delivered. So now TILA is invoked and the right to at least an investigation is granted. And then they go through the process that you described.

I am aware that I am going into minutiae now, but TILA also has a provision regarding "claims and defenses" which the cc associations have interpreted to mean that consumers can file claims that the product or services rendered is materially different from what is promised, and therefore a chargeback is warranted. I would not enjoy arguing the specific case of xforce nerf vs D3 EULA in arbitration. It would just be too surreal but maybe the arbitrator would turn out to be an mpq player and totally get it

the one thing I don't know is how Apple and Google hold their developers accountable to any financial or nonfinancial repercussions. Because the losses at this point accrue to Apple - they face off against the bank in the chargeback scenario

According to a guy who works at a company with an app with IAPs.... Apple just take their money back from the dev. I imagine the contract is VERY in their favour because, after all, what other delivery method do you have? Apple (and google) can probably be pretty damn draconian when it comes to knocking up contracts because there are no other sensible options for a dev of a mobile app to pursue.

Unknown

There are always 2 sides to an argument.

wymtime

garbageman72 wrote:

This seems to be a burning issue right now, so I thought I should make a post to explain as much as possible what is likely to happen if you do a chargeback on a credit card charge. I work for an online company with a Fraud team in place for this sort of thing, and I've assisted them on a number of occasions. I know the process pretty well. I've spoken to representatives from all the major credit card companies, and I know what their processes are as well.

So here is how this works, from an inside perspective.

You're upset at D3 for [insert reason here]. Either you contacted D3 to complain and didn't like the response you got, or you skipped that whole step and went directly to Apple/Google/Visa/Mastercard/whomever. Believe me when I tell you that none of those companies is going to know what D3's refund policies or EULA terms are, and they are not going to look them up. You request a chargeback, they put through a chargeback, you get your money back.

Now this is the part you likely aren't aware of. Apple/Google/Visa/Mastercard/whomever is out the money they've credited back to you. They will then contact D3's Fraud team directly with your credit card charge (time, date, amount, card #, and IP address), and advise that you contacted them and requested a chargeback. D3 will review the charge and inform Apple/Google/Visa/Mastercard/whomever that this is a valid charge and therefore is a fraudulent chargeback and will likely point to the EULA terms - which will clearly show that you were not entitled to a refund, and therefore the chargeback is fraudulent. At this point, Apple/Google/Visa/Mastercard/whomever is likely to reinstate the charge on your credit card, D3 is likely going to ban/sandbox you for breaking the terms of the EULA, and you'll also end up with your credit history being ruined. There's also a pretty good chance that, much like a non-sufficient funds check, your banking institution is going to levy a charge against your account - although that doesn't seem to happen consistently.

I'm not telling anyone what they should be doing, but if you're going to do a chargeback on a credit card charge, this is exactly what you can expect.

I work for a major bank and managed a retail bank location for 8 years. If you dispute a charge the bank gives temporary credit based on the type of charge. If the charge is show as legitimate it is charged back to your account. The bank does not put a negative mark on your credit, or your bank record which is called check systems in the U.S. All that happens is your money is taken back from where it was originally charged either credit card or debit card. Now if you are constantly disputing charges and making fraudulent claims the bank will close your account because you are becoming a risk to the bank. If it is a credit card it show up on your credit as closed by creditor. The only effect it has is you have less open trade lines and less available credit. Your payment history will effect your credit significantly more than this. Available credit is important, but the balances you carry and payments you make are significantly more important.
For check systems and your bank account it can be much more impactful. Major banks will will see that your checking account was closed for fraudulent activity and you will either be denied the ability to open an account or, be placed into a restricted account until you prove that you are a responsible customer. If a bank closes your checking account due to fraudulent activity they will deny you for bank products in the future no matter what the time frame. Burn me once shame on you burn me twice shame on me philosophy.
Overall the op is right, and wrong. If you do 1 dispute it won't b a big deal, but if you are a multiple offender, your bank might decide to part ways with your relationship. banks reserve the right to close your account for any reason. If you are rudeto tellers, or bankers, or even flirt with them, the manger can close your account.
Also as a word of advice if you threaten to close your account if you don't get what you want don't be surprised if the manager says "fine let's close your account." I know that is what I did when customers decided to not treat my employees and myself with respect.

puppychow

re: closing accounts. Under federal law, financial institutions are required to report transactions involving $3,000 or more. The idea is that feds want to keep taps on possible funding of terrorist activities and money laundering. If you move large sums of money around from one place to another frequently, bank employees will at least talk to you about what the money is for. If they get too leery they might even close your account.

Last year, my mom went to her bank and ordered a bank check for a four sum figure as part of a home refinance. and the bank employee was asking very specific questions about the money and had to get manager's approval before going ahead with the transaction.

The point here is that: a) banks are more noisy about your transactions involving larger sums of money, b) they are less reluctant to close your account on the spot if they see possible illegal activities involved. And as the banker just said, once your account is closed you WILL have trouble opening up a new one.

wymtime

puppychow wrote:

re: closing accounts. Under federal law, financial institutions are required to report transactions involving $3,000 or more. The idea is that feds want to keep taps on possible funding of terrorist activities and money laundering. If you move large sums of money around from one place to another frequently, bank employees will at least talk to you about what the money is for. If they get too leery they might even close your account.

Last year, my mom went to her bank and ordered a bank check for a four sum figure as part of a home refinance. and the bank employee was asking very specific questions about the money and had to get manager's approval before going ahead with the transaction.

The point here is that: a) banks are more noisy about your transactions involving larger sums of money, b) they are less reluctant to close your account on the spot if they see possible illegal activities involved. And as the banker just said, once your account is closed you WILL have trouble opening up a new one.

You are close in your descriptions. The specific dollar amount is incorrect. As far as your moms experience is concerned you also have to remember banks are about service and sales, so tellers are looking to ask question to see if that bank has a product to fit there needs, and then offer that product, or sit down with a banker. All tellers have limits on the size deposits, and withdrawals they can do and if a transaction exceeds that limit someone has to approve with that limit would have to approve that transaction. My guess is the teller was more looking to have a conversation and sell a product than worry about fraud.

By the way my employees called me supreme overlord not banker.

Unknown

garbageman72 wrote:

D2KM_ wrote:

This is great info thank you for this post!! Just curious what about ppl who use gift cards to purchase goods in game instead of a credit card? How is that process audited/reported if there was no credit card transaction?

That's a great question, and one I unfortunately don't have the answer to. All of the transactions our company handles are done through credit cards - no cash, no checks, no gift cards.

Good info, now here's another scenario.

What if you buy a bunch of in game items in a game, that you then later use, then you file a claim to the credit card company that you did not purchase such item.

During time of purchase, let's say you use Starbuck's wifi, so the IP wouldn't be relevant? Or what if you said that your child made the purchase on accident and you did not authorize that, etc... (lies of course)

evil panda

Gift card = cash equivalent, typically credit card protections do not apply. You can certainly appeal to their goodwill, though

Claiming you never made the transaction - companies like Apple and Google have pretty good authentication processes. It's likely going to be hard to completely disprove your participation

Claiming another party accessed your account - typically not a reason to get recourse although again, you can appeal to goodwill. Or file criminal fraud charges against your family member

Turbosmooth

I had one alliance member who bought a Stark Salary, logged out, and back in and all new HP was gone. It took him weeks to get the HP credited. Meanwhile, the token pack he wanted was long gone and I don't blame him for not buying more in the meantime.

So far I haven't had any problems, but there were a few times that while attempting to make Stark Salary purchases, I got time out errors. Little scary -- actually never checked my PayPal account for accuracy. But it mostly timed out before putting in my Google password.