Thread Options
#2012617 - 05/06/15 08:54 PM Phishing or buyers remorse?
dazzling Offline
New Poster
Joined: May 2015
Posts: 3
My cardholder was notified that her computer was infected with a virus and agreed to pay a company to clean her machine. After she was charged the agreed upon amount, she decided this was probably a scam and filed a dispute. She states her computer is still not working right.
We filed a claim with the cardholder admitting participation but it was denied when the company showed their terms and conditions.
The company who "cleaned her computer" is new but not listed on any of Visa's disreputable merchants lists so I am assuming they are legit. Since they are not, we can't re-file the claim as unauthorized.
Is this a case of phishing in which the bank would be liable or is this a case of buyers remorse in which the bank is not?
Who has the burden of proving phishing? Does the bank take the loss whever a cardholder is phished or scammed?

Return to Top
eBanking / Technology
#2012637 - 05/06/15 09:46 PM Re: Phishing or buyers remorse? [Re: dazzling]
BrianC Online
Power Poster
BrianC
Joined: Nov 2004
Posts: 5,665
Illinois
Since the customer admitted that they authorized the original charge and they were charged the correct amount, Reg E does not apply to this situation.

The circumstance that applies here is VISA Chargeback code 53 "Not as Described." One of the reasons to file this chargeback as stated in the VISA rules is, "Computer software, including anti-virus software that is sold using inaccurate online advertisements or that contains malicious software downloads."

In order to properly process this chargeback, the cardholder must first attempt to resolve with the merchant, document the response, and also document what was promised versus what actually occurred.

The merchant represented stating that they honored the terms of the contract. The ball is back in your court. If the customer can demonstrate to your satisfaction that the merchant did not live up to the terms of the contract, you can request an updated letter along with proof to substantiate their claim (maybe they take it to Geek Squad to show that the malicious program is still there) and you can file pre-arbitration against the merchant to continue the dispute. Or if you feel the merchant has made their case, you can deny the claim.
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top
#2012720 - 05/07/15 02:58 PM Re: Phishing or buyers remorse? [Re: dazzling]
dazzling Offline
New Poster
Joined: May 2015
Posts: 3
Thank you. We are working on the pre-arb. But what about the phishing aspect? If a cardholder admits to participating but it ends up looking like a scam and phishing, are they off the hook?

Return to Top
#2012767 - 05/07/15 04:38 PM Re: Phishing or buyers remorse? [Re: dazzling]
BrianC Online
Power Poster
BrianC
Joined: Nov 2004
Posts: 5,665
Illinois
Phishing is where I send you a fake email and trick you into providing your card number so I can make unauthorized purchases. This was misrepresentation. It is no different than if I win a bid on Ebay for an IPad and after I pay, receive a box with a brick in it. VISA has chargeback protections to help me get my money back from the dishonest merchant, but Reg E has no such protections for me being swindled by a dishonest merchant. It is up to the cardholder to know whom they are doing business with.

(Reminder for credit cards that Reg Z does have the provision limiting customer liability for purchases for which they are dissatisfied.)
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top
#2012901 - 05/07/15 11:56 PM Re: Phishing or buyers remorse? [Re: BrianC]
BetsyS Offline
Gold Star
Joined: Jun 2009
Posts: 468
Originally Posted By BrianC
but Reg E has no such protections for me being swindled by a dishonest merchant.


To play Devils' advocate, reading the Staff Interpretation comments on the definition of "Unauthorized Electronic Funds Transfer", I would argue the intent behind Reg E is to provide protections against dishonest merchants:

2(m) Unauthorized Electronic Fund Transfer

1. Transfer by institution's employee. A consumer has no liability for erroneous or fraudulent transfers initiated by an employee of a financial institution.
2. Authority. If a consumer furnishes an access device and grants authority to make transfers to a person (such as a family member or co-worker) who exceeds the authority given, the consumer is fully liable for the transfers unless the consumer has notified the financial institution that transfers by that person are no longer authorized.
3. Access device obtained through robbery or fraud. An unauthorized EFT includes a transfer initiated by a person who obtained the access device from the consumer through fraud or robbery


Wouldn't such a swindle fall under the category of fraud, meeting the definition of an unauthorized EFT?
_________________________
Let's start at the very beginning; A very good place to start...

Return to Top
#2013156 - 05/08/15 10:40 PM Re: Phishing or buyers remorse? [Re: dazzling]
BrianC Online
Power Poster
BrianC
Joined: Nov 2004
Posts: 5,665
Illinois
If I trick you into giving me your card number (access device) so that I can use it to make fraudulent transactions, that part of the interpretations will apply. If I say, "hey, wanna buy a watch?" And you miss the fact that Rolexxx has 3 x's, I have not obtained you access device to use it for any transactions you did not authorize. That is what happened here. I said I would fix your computer. You believed me, so I charged the agreed amount. I did not make any additional unauthorized charges so I did not use the access device in a way that you did not agree to.
_________________________
Sola Gratia, Sola Fides, Sola Scriptura, Solus Christus, Soli Deo Gloria!
www.tcaregs.com

Return to Top

Moderated by:  Andy_Z