Chargeback Attack
While going over my credit card bills, I notice a payment for around $100 listing a company I do not recognize on the one issued by my bank; however, this is just after Christmas and I shopped online, so this could be a legitimate charge. After investigating, I manage to track down a phone number for the company and work through the “how much” and “when” with the representative.
Representative #1: “That’s for a [product].”
Me: “What on Earth is a [product]?”
Representative #1: *Laughs* “I have a sneaking suspicion this won’t match, but would you mind confirming your address for me?”
Me: “Sure. It’s [address].”
Representative #1: “Any chance you have a friend or relative in Belize?”
Me: “Nope. Definitely not my purchase.”
Representative #1: “No surprise at all. Anyway, if you are willing to wait a couple of days… maybe a week… we can notify [Bank] and resolve this without a chargeback.”
Me: “That’s fine; I will check my statement then. And just to confirm, your name was [Representative #1], right?”
Representative #1: “Yes, sir. And thank you for your understanding.”
Sure enough, a few days later, the transfer is gone from my history on the website and my balance is corrected. I put the whole adventure out of mind… until my next statement comes in, and the charge is back.
This time, I call the bank and explain the phone call, complete with the product, the representative’s name, and the date and time of the call.
Bank: “Yes, we got the request to withdraw the charge, but then we got the request for the same charge a few days later. If you want, we can do a chargeback to resolve this.”
Since the first person was helpful, I decline, instead giving the company another chance. I get a different person, but I relay the entire interaction.
Representative #2: “I can see from our notes that [Representative #1] did push everything forward. However… without getting too specific, the person who did make the purchase is a frequent buyer of ours, and this is the first dispute on the account. I can’t tell you what I’m thinking, but based on the notes, if it’s not malicious, I think I know exactly what happened to cause a second charge to you. If you’re willing to give us another chance, we can resolve this without the nuclear option.”
Me: “I’ll give you guys one last shot. After this, you can fight [Bank].”
Once again, it is all fixed. Once again, the charge come back. This time, I do file the dispute and then request a new card. Despite this, the charge is once again reapplied.
This time, I go to my bank in person and demand the manager.
Me: “How the h*** did they charge a card that’s been canceled?”
Manager: “This is the charge from the old card. They challenged your chargeback and won.”
Me: “And what did you guys do to fight back? Did you list my calls with [Representative #1] and [Representative #2]? Give them all the details to look it up? Prove my address doesn’t match? Go over the actual buyer’s history? Anything?”
Manager: “Um… it looks like we didn’t appear.”
Me: “‘Didn’t appear’? So, you knew they challenged it, and you did nothing?”
Manager: “…”
Me: “Here’s what we’re going to do: you’re going to dispute it again, and if they challenge again, you’re going to fight.”
Manager: *Spins the monitor* “There; all done.”
Me: “Now, you’re going to cancel the card and close my accounts.”
I settled into a new bank fairly quickly after that. But the tale did not end there, as my old bank sent me a notice that there was still a $100 charge unpaid. That led me to a lawyer to get this mess cleaned up. The fun started when a lawyer representing the company reached out to my lawyer and spoke of cooperation. I learned the reason for the second charge was the result of auto-complete and an inattentive worker.
The interesting reveal was that the company never challenged the formal dispute; they got hit with the full weight of a chargeback and sought to rectify it by pursuing legal action against the recently fired individual who caused this mess by thinking a client’s credit card information could be stored through their web browser. That left us with the question: who was demanding my $100?
The bank very quickly agreed to pay everyone’s legal fees and waive the charge, and they gave a few tens of thousands in compensation to each of us provided we withdrew the case and kept quiet.
I am an insurance agent. Most of my colleagues knew about my plight and that this bank was not being helpful. A lot of people like to refinance and use electronic transfers for automatic payments. I may not have told the full conclusion of my story to anyone and did not start it with anyone new, but we did tell anyone looking for a mortgage that a certain bank had been giving us a lot of problems.
After about two years of needling people away, this stopped being a personal story; this became the only bank unwilling to check the integrity of the policy or notify anyone that they did not receive the new declarations page or invoice.
Sadly, they are still in business, but pretty much everyone we know is aware that this bank is not the sterling company it used to be.
Related:
Cash Back Attack, Part 18
Cash Back Attack, Part 17
Cash Back Attack, Part 16
Cash Back Attack, Part 15
Cash Back Attack, Part 14