Bank Scam On Purchases Abroad

EdBrown

>:( Like many others I have a card (Nationwide) which I always use for purchases abroad (no commission and better than tourist exchange rate).
In Gran Canaria last month I used it to purchase a portable DVD Player/TV Tuner but was livid when I saw the retailers receipt; His card processing agent (Tele-Banco I believe) converts the sale price from Euros to Sterling at their own exchange rate which in this case was lower even than the tourist rate available in the resort at the time. Thus my account was billed in Sterling instead of Euros and my favourable exchange rate was lost, I effectively paid 10 euros more than I should have.
I tried getting Money Mail to expose this scam but they have not bothered, perhaps Martin would check it out for us and publish a list of any other card agents operating this scam so we may all attempt to avoid them when purchasing abroad.

deemy2004

>:( Like many others I have a card (Nationwide) which I always use for purchases abroad (no commission and better than tourist exchange rate).  
In Gran Canaria last month I used it to purchase a portable DVD Player/TV Tuner but was livid when I saw the retailers receipt; His card processing agent (Tele-Banco I believe) converts the sale price from Euros to Sterling at their own exchange rate which in this case was lower even than the tourist rate available in the resort at the time.  Thus my account was billed in Sterling instead of Euros and my favourable exchange rate was lost, I effectively paid 10 euros more than I should have.
I tried getting Money Mail to expose this scam but they have not bothered, perhaps Martin would check it out for us and publish a list of any other card agents operating this scam so we may all attempt to avoid them when purchasing abroad.

So what was the rate ?

£/$ examples
Generally an acceptable rate is say 175 to 185, if spots 180.
Though it can go to 170 to 190 or worse for a spot of 180

EdBrown

welcome to the planet earth ... the rate was lower even than the tourist rate as opposed to the bank rate which I would have got had my account been billed in euros and is generally about 4 cents above the tourist rate ..the actual rate of exchange on the day is irrelevant.

So what was the rate ?

Generally an acceptable rate is say 175 to 185, if spots 180.
Though it can go to 170 to 190 or worse for a spot of 180

pin

I think this has come up before somewhere on one of the boards. Apparntly it is quite common for hotels to do this.

MSE_Martin

This is an interesting one. If you specify to pay in the foreign currency that is the way it should be.

I will see what Nationwide has to say.

martin

dag_2

This is an interesting one. If you specify to pay in the foreign currency that is the way it should be.

I will see what Nationwide has to say.

I agree with that. To my way of thinking - if a retailer charges something to your credit card that you did not authorise, then it's theft. It's theft if it's a continuous authority transaction that they won't let you cancel, and it's theft if they charge an amount which is different to what you originally authorised.

Otherwise, what's to stop them applying very steep but totally arbitrary exchange rates, such as "one US dollar is twenty pounds sterling" or "one euro is fifty pounds sterling"? Plain and simple - it's theft.

My advice is to do whatever you would normally do when you have been the victim of credit card fraud - for example, notify the card issuer, refuse to pay the account until they've credited it off etc.

MarkyMarkD

It's quite clever, if you think about it from the card processing agent's point of view.

Because most customers would pay their credit card operator 2.75% of the transaction, they won't mind paying a price which is a few % higher in sterling if it eliminates that charge.

It's only those with Nationwide cards who are MSEs who actually notice the difference.

But I concur with the advice above - if you sign a credit/debit card payment slip in a particular currency, the transaction should be charged to your account in that currency. Anything else is a scam.

BUT equally well you are talking about £7 here - are you surprised that there wasn't huge press interest in investigating this trivial amount?

Deemy's point wasn't completely irrelevant - if the rate had fluctuated over the period between the transaction and it hitting your account, you might not have lost out for the reason you suggest (i.e. them ripping you off) but due to currency fluctuations. This is a common problem with foreign currency transactions (as I'm sure you are well aware).

EdBrown

It's quite clever, if you think about it from the card processing agent's point of view.

Because most customers would pay their credit card operator 2.75% of the transaction, they won't mind paying a price which is a few % higher in sterling if it eliminates that charge.

It's only those with Nationwide cards who are MSEs who actually notice the difference.

But I concur with the advice above - if you sign a credit/debit card payment slip in a particular currency, the transaction should be charged to your account in that currency.  Anything else is a scam.

BUT equally well you are talking about £7 here - are you surprised that there wasn't huge press interest in investigating this trivial amount?

Deemy's point wasn't completely irrelevant - if the rate had fluctuated over the period between the transaction and it hitting your account, you might not have lost out for the reason you suggest (i.e. them ripping you off) but due to currency fluctuations.  This is a common problem with foreign currency transactions (as I'm sure you are well aware).

Yes I was surprised that financial watchdogs aren't interested in investigating a £7 skim off on a single card transaction: Imagine a bank skimming £7 from just 10 transactions per year of it's 2,000,000 customers ... not such a trivial adjustment to their bottom line at year end eh?

DesG

This is common practice in the South of Ireland, I have had stand up arguements with some 'Managers' as I refuse to pay anything other than the Euro price.

Most people don't even notice ::) , ah well.

And the best bit is they print off on your receipt that you give them permission to do the currency conversion, bar stewards.

Cheers, Des.

pin

Just fallen foul of this in Spain. I specifically asked the hotel to make sure the payment was in Euros. They said no problem. Got the receipt, amount in euros, however further down there was a converted UK£ rate (and the conversion rate).

On my statement I have been charged the converted UK rate. The difference is quite a bit: rate I should have got was 1.42, hotel converted rate was 1.38.

Have spoken to Nationwide about this. They said this is becoming more and more common, especially with hotels in Spain and Portugual and hotels should not be doing this. They said they have notified Visa about this, and in turn Visa has told their merchants.

The lady I spoke to said there was nothing much they could do, however I persisted and I've now submitted a dispute, shall see what happens.

EdBrown

This is the whole point of the issue: At no time has the customer ever consented to the foreign bank handling the card transaction becoming the exchange rate bank too.

This is common practice in the South of Ireland, I have had stand up arguements with some 'Managers' as I refuse to pay anything other than the Euro price.

Most people don't even notice  ::) , ah well.

And the best bit is they print off on your receipt that you give them permission to do the currency conversion, bar stewards.

Cheers, Des.