[HN Gopher] Visa Changes Chargeback Dispute Program
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Visa Changes Chargeback Dispute Program
Author : cwwc
Score : 31 points
Date : 2022-07-20 20:15 UTC (2 hours ago)
(HTM) web link (usa.visa.com)
(TXT) w3m dump (usa.visa.com)
| brianhorakh wrote:
| This is awful. I've canceled subscriptions so many times only to
| get billed again, and again, blabla "it's a bug in the billing
| system" run around.
|
| So now vendors can keep auto billing with dark patterns such as
| unnavigable automated phone lines, and visa is going to take
| their side? (because the merchant will have proof of billing
| history?)
|
| I hope Amex doesn't adopt these rules. I am going to think
| strongly about canceling my visa cards as a response.
|
| Bitrix24 a SaaS crm/VoIP service was the worst abuser I can
| recall (kept randomly reappearing a $10.00 months after id asked
| visa to block them). Free Trial My ass.
| phpisthebest wrote:
| This is why I use capital ones service to create a new number
| for every vendor (similar to privacy.com) then I can just turn
| off that card once I cancel the service
| vineyardmike wrote:
| I think if you can prove that you tried to cancel and the
| merchant screwed up you should be fine. Hopefully you have a
| paper trail of them admitting its a "bug in Billings".
|
| Aside: One of the best things about AMEX is their customer
| support around chargebacks and I agree I hope they stay super
| friendly to this.
| InfamousRece wrote:
| Cancellation is not always easy. Any "recurring" charge will
| helpfully reopen your closed account. I guess it's better to
| just use prepaid gift cards for subscriptions.
| danlugo92 wrote:
| www.privacy.com
| rurp wrote:
| I totally agree. Chargebacks are one of the few tools consumers
| have to fight back against shady companies. I think I've only
| done one or two chargebacks in my life, but I have threatened
| them other times when dealing with dishonest companies, which
| usually leads to them suddenly resolving an "impossible" issue.
|
| If Visa ends up crippling this ability there's no chance I'll
| use their cards again.
| toomuchtodo wrote:
| > If Visa ends up crippling this ability there's no chance
| I'll use their cards again.
|
| Curious how this makes other options more competitive. If
| liberal dispute policies are one of the value props of using
| a CC, and merchants eat the fees, the value of using a CC
| declines if dispute resolution is tightened up making it
| closer to parity of irreversible funds transfers.
|
| https://www.moderntreasury.com/learn/what-is-fednow
|
| https://news.ycombinator.com/item?id=32098635
| jimbob45 wrote:
| It cuts both ways. You could make a very strong argument that
| "friendly fraud" is the single reason that the porn industry is
| having to turn to crypto. Husbands are frequently caught by
| their spouses and, while pretending that the charge was
| fraudulent, commit "friendly fraud" themselves.
|
| I, for one, am very happy to see Visa taking steps against
| this. We've kvetched for years over how how much power payment
| processors have in the system and now they're finally doing
| something about it (themselves, to boot!).
| snoopy_telex wrote:
| Privacy dot com. It's the only thing I use for anything that's
| not a major player (Amazonish). It's saved me a lot of time and
| hassle. Cancel the account and the card at the same time.
| tumetab1 wrote:
| Be aware that "When most people think of fraud, they think of
| stolen account numbers or identity theft, but first party misuse,
| which can account for up to 75 percent of all chargebacks[1]"
| looks like marketing spin.
|
| The reference points to a marketing newswire that also states
| "More than two in five (42%) of surveyed consumers who have filed
| disputes did so due to true fraud--e.g., unauthorized purchases
| made with their payment information."
| https://www.globenewswire.com/news-release/2021/12/15/235295...
|
| Going deeper the actually 75% comes is stated on this PDF which
| links (sources) from a company that sells... sells dispute
| charges services.
| https://pages.sift.com/rs/526-PCC-974/images/ebook_Sift_Q4_2...
|
| Others things to note: No statement by Visa in decreasing taxes
| on chargebacks to merchants.
| twawaaay wrote:
| Chargebacks are used as a kind of punitive measure directed at
| merchants. The idea here is for merchants to figure out the
| only way to deal with chargebacks is to not get chargebacks at
| all.
|
| For now this works because for some reason relatively few
| cardholders are educated enough on what are and how to use
| chargebacks.
|
| I personally wouldn't be using credit card if not for the
| chargebacks. I am still paying off entire balance every month,
| but I am much happier knowing that any dispute on a transaction
| with a credit card is going to be so much easier than any other
| form of payment.
| rvz wrote:
| > A recent study by SIFT found that nearly one in five consumers
| who have filed a chargeback dispute have committed first party
| fraud by submitting false claims in order to get their money back
| on legitimate purchases. In fact, according to the NRF, the
| losses from friendly fraud totals over $25 billion a year.
|
| Yes, this is a problem and so many merchants are getting their
| accounts and funds locked up by being unable to fight these
| friendly fraud disputes that have been taken advantage of by the
| consumer.
|
| This sort of fraud hurts both the consumer and mostly the
| merchant as the bank which doesn't know any of the context of the
| payment takes 3 seconds to see the dispute and 98% of the time,
| the merchant loses and the bank forcibly takes the money away and
| gives it back to the customer, especially for digital
| subscriptions. Instead the consumer should contact the merchant
| directly to resolve the dispute.
|
| At least VISA knows it is a problem. What is Mastercard doing
| about this?
| wilde wrote:
| > Instead the consumer should contact the merchant directly to
| resolve the dispute.
|
| Hahaha. Have you tried this recently? I had a company ship us
| defective baby food with broken seals. They said they couldn't
| refund but they were happy to ship us a replacement. When we
| said we wanted a refund instead, they said "whoops we already
| shipped it". It arrived with more broken seals. I issued a
| chargeback. Got my money instantly.
|
| Some merchants are bad. Visa's whole value to me is that they
| insure me against these situations.
| nathanaldensr wrote:
| When both sides of a marketplace are willing to commit fraud,
| what can the middleman do? Most likely not much. As long as
| purchases are not "notarized" or otherwise observed in person
| by a neutral third party, it is very, very difficult to
| reliably and fairly police unethical or fraudulent intentions
| for internet purchases.
| im3w1l wrote:
| Keep the money for themselves. Disincentives fraud, and it's
| profitable too!
| noSyncCloud wrote:
| >$25 billion a year.
|
| What an amazing number, wonder where that came from ;)
|
| Now let's compare that figure to the amount stolen yearly by
| unethical merchants :)
| tehwebguy wrote:
| > "Friendly fraud is not always friendly, especially from a
| merchant's perspective," said Mike Lemberger, Senior Vice
| President of North America Risk at Visa.
|
| Incredible quote, Mike must be the smartest guy in the whole
| company!
| gruez wrote:
| Many commenters in this thread seem to be against this change,
| but looking at the article they seem... pretty reasonable?
|
| >With this change, if merchants can provide additional data or
| evidence to show that the disputed charge is valid, then the
| dispute will be invalid.
|
| >This change will empower merchants to protect themselves against
| first party misuse by enabling them to submit additional evidence
| that a purchase was indeed legitimate and authorized by the
| cardholder in order to stop the dispute claim. Additional
| examples that can help identify that a purchase is legitimate
| include a customer using the same payment credential previously
| at the merchant, login credentials, proof of use of a product and
| more.
| uoaei wrote:
| It sounds like a great way to create a system that concentrates
| and abuses power, not unlike a "secret court". If the company
| claims something like "it's covered in the ToS/EULA" what
| recourse do consumers have if that statement is not exactly
| true? If Visa agrees with Walmart about some nebulous wording
| in legalese, where a judge would read it differently, how can
| consumers advocate for themselves? Lawsuits are an option only
| for those with the time and access to pursue remuneration
| through the legal system so that is not a serious option here.
| twawaaay wrote:
| If I understand this correctly it is essentially doing second
| presentment preemptively. ("Hey, Visa, just in case the client
| questions authorisation, here you have some additional data to
| shoot those down immediately without you having to contact me
| for those details")
| tristor wrote:
| The biggest issue here is that the "proof" allowed essentially
| means recurring billing scams can run rampant without any
| recourse. Unfortunately a significant amount of "businesses"
| online and offline are forms of recurrent billing scams.
| Chargebacks are the /only/ protection consumers have against
| this form of scam, other than going to court at their own
| expense.
|
| This GREATLY weakens consumer protections for basically no
| upside by enabling bad actor merchants. End of story.
| BrandoElFollito wrote:
| I am not sure I understand the problem. Why is everyone telling
| about VISA? Do you deal directly with VISA?
|
| Here in France (and generally, the EU) your interlocutor is a
| bank that happens to deliver VISA or Mastercard cards.
|
| If something is wrong, you contact your bank which is obligated
| to give you back the money and then does an investigation
| afterwards.
| runnerup wrote:
| Considering temporary card numbers like privacy.com are also
| getting harder to use...
|
| I guess I'll just open and close online checking accounts giving
| 30-day windows for online purchases using a debit card.
|
| After 30 days the debit card will no longer be valid, linked to a
| closed account, and cannot be charged recurrently.
| vineyardmike wrote:
| FYI usually banks keep accounts "shadow open" for upwards of
| 6mo in case a charge comes through. So you still may get over
| drafted.
|
| These sort of schemes will probably make chargebacks harder to
| use than just closing the account that would do the billing. If
| the card is leaked/frauded than you're already legally
| protected. If you just want to avoid the act of cancelling an
| account you opened... then you're playing into the arms race
| that is making these things harder.
|
| > but first party misuse, which can account for up to 75
| percent of all chargebacks, is when a cardholder disputes a
| legitimate purchase that they intended with their issuer. This
| includes customers refuting valid purchases such as long-
| forgotten recurring subscriptions
|
| If you agree to a purchase, and sign up for something re-
| occurring, you're committing to it. You have to tell the
| business to stop charging you, you can't just stop paying.
| runnerup wrote:
| And what when the 8th company this year refuses to honor the
| proper cancellation? Lawsuits take way more energy.
| snoopy_telex wrote:
| I haven't had any issues with privacy cards after the latest
| switch. They've not been flagged as prepaid cards for me.
| rationalfaith wrote:
| atourgates wrote:
| There's a tremendous amount of devil in the details of how this
| is implemented:
|
| > "With this change, if merchants can provide additional data or
| evidence to show that the disputed charge is valid, then the
| dispute will be invalid."
|
| I've seen (from the merchant side) unfair chargebacks. No
| question.
|
| But my fear is that Visa is going to implement this something
| like YouTube copyright claims, where basically, the merchant just
| has to respond and that's it.
|
| The last chargeback I issued was for an electronics seller who
| never credited me for a return. I explained the issue to American
| Express' automated system. Uploaded receipts (including the
| seller's return instructions, and delivery confirmation of the
| returned item), and got an instant refund.
|
| I'd love to know how Visa's changes will affect this type of
| chargeback. It's wasn't "fraud" in the sense that someone used my
| credit card without authorization. But it certainly was a
| merchant that didn't follow up on their end of the deal.
| bestouff wrote:
| Then they'll finish to loose it to Paypal.
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(page generated 2022-07-20 23:00 UTC)