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Disputing an Internet Purchase

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Question: 
We have a customer that used his debit card to make a purchase on the internet. He says he did not receive the product and was charged more than what the website said he would be charged. He contacted the merchant and they said they would send him another product. He says that he has not received that product either. Can he dispute this through the bank? If he can, is he covered under Reg E or Visa?
Answer: 

Reg E rules are separate from Visa rules. You'll find that generally the Visa rules are more restrictive to you, and favorable to the consumer. These Visa protections overlay on Reg E. As long as a rule is more favorable to the consumer, you may employ it. You can never do less than Reg E requires.

You'll have to look at transactions themselves to see how they are processed to know if the Visa rules apply. I can't address the Visa side of the question.

Reg E always applies. The main point on Reg E is "was the transaction authorized?" Reg E is not concerned with satisfaction of the product or services, or even the receipt of the product. A credit card transaction would be, and your Visa rules may be, but Reg E is not.

You indicate that the transaction was authorized. That could close your claim file, except that you also say the debit was for more than was agreed. If that is the case, the debit of say $25 was authorized, but $35 was debited. That means the transaction wasn't authorized and would need to be investigated.

I would ask for any correspondence and the web address for the transaction. Purchases I have made always include a confirmation of the transaction. Ask why he thinks the two amounts differ. If it was shipping, and the shipping cost was separately disclosed, I would not look favorably at paying the claim. If he agreed to a debit of one amount, but another was taken, I would seriously consider that this may be a valid claim. Certainly you have other steps still to take in your investigation to determine if the claim will be paid or denied.

First published on BankersOnline.com 5/26/08

First published on 05/26/2008

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