Charge back fraud.

BonnieS_2

Hello, I was wondering if anyone has ever came across this and knows where we should look for advice?

We have a small business which provides a service. Clients book appointments over the phone and leave a deposit with a card. We have to input all card details that are required, including security code etc.

Then when the client comes in and receives the service they pay off the balance minus the deposit.

We currently have an individual who paid a deposit by card, got the service, completed a consent form etc for the service, but has now called his issuing bank stating that he did not authorise the payment to us.

Our card machine company are saying that the money will be taken back off us and there is nothing we can do. Is this right? Can anyone just claim that they never authorised something and get the money back whilst having already received the goods/services?

Feel very frustrated.

Thank you in advance for any information you have

scoly

BonnieS wrote: »

Hello, I was wondering if anyone has ever came across this and knows where we should look for advice?

We have a small business which provides a service. Clients book appointments over the phone and leave a deposit with a card. We have to input all card details that are required, including security code etc.

Then when the client comes in and receives the service they pay off the balance minus the deposit.

We currently have an individual who paid a deposit by card, got the service, completed a consent for etc for the service, but has now called his issuing bank stating that he did not authorise the payment to us.

Our card machine company are saying that they money will be taken back off us and there is nothing we can do. Is this right? Can anyone just claim that they never authorised something and get the money back whilst having already received the goods/services?

Feel very frustrated.

Thank you in advance for any information you have

I'm sure you can appeal the chargeback (if you act promptly)

The client presumably paid via chip & pin for the remainder of the contract after the goods/service was supplied (so presumably are not attempting a chargeback on this amount) so it's just the deposit in dispute.

The evidence they paid the remainder would suggest, on a balance of probablility, that they authorised the original deposit.

paddyrg

Were the balance and deposit on the same card? If not, maybe the balance card can be charged?

InsideInsurance

scoly wrote: »

I'm sure you can appeal the chargeback (if you act promptly)

You can appeal them but the success rate is very small with the banks almost always siding with the consumer. Look at the small business forums and most say its not worth the effort appealing and go straight for recovery from the customer. I disagree but dont hold your breath.

Its not clear from the message if the customer actually received the service or not? If they did then hopefully you have evidence of this plus their address in which case send a letter before action and go to small claims court if the money is worth while doing so.

If they didnt get the service and are simply doing it to get their deposit back you will have to see if you have actually suffered losses from the end purchase not materialising. You could still send a letter before action and ultimately go to court but they may challenge the amount being with held as not be proportional to your losses and thus in breach of the legislation around fair/ consumer contracts

BonnieS_2

Hi, thanks for the reply's. Yes they received the service. The total price was £200, they left £50 on the card as the deposit, and paid the remaining £150 in cash when they came into the premises after getting the procedure done.

Ironically the service they received was permanent to their body, so if the bank simply met them in person they would see that indeed they did get the entire service they paid for. However, I do not hold my breath for that ever happening!

We have sent the supporting material to the card services team, but from what their letter stated to us they implied it was almost impossible for us to win this.

I am just totally shocked that anyone could do this. Could call a shop tomorrow and buy a £5000 TV, take the TV home, call you bank and claim you never authorised that, and get your money back! Leaving the poor trader completely at a loss!

Savvy_Sue

Is it possible it wasn't their own card they paid the deposit on?

scenario: son decides he's going to get a tattoo, books appt using dad's card to pay deposit, pays balance in cash, Dad finds out and goes ballistic ...

dacouch

Savvy_Sue wrote: »

Is it possible it wasn't their own card they paid the deposit on?

scenario: son decides he's going to get a tattoo, books appt using dad's card to pay deposit, pays balance in cash, Dad finds out and goes ballistic ...

It sounds like they paid the initial deposit over the phone and no chip and pin was used which means the payment is not guaranteed.

paddyrg

My hunch is that it was a snide card for the deposit if they paid the balance in cash. Do you have any other forms of ID (eg if it was a tattoo you may have taken a passport scan as proof of age)

p00hsticks

BonnieS wrote: »

I am just totally shocked that anyone could do this. Could call a shop tomorrow and buy a £5000 TV, take the TV home, call you bank and claim you never authorised that, and get your money back! Leaving the poor trader completely at a loss!

As other posters have suggested, it may not be as simple as this - it could be that the person who you provided the service to isn't the cardholder and was using the card fraudulently. As paddyrg says, did you happen to see any proof of id ?

Look at this from another way - how would you feel if someone used your own card details to walk into a shop and buy a £5000 TV and take it away, and you were then told you couldn't have your money back because it would leave the 'poor trader completely at a loss!' ?