[FTC] FTC, Florida Lawsuit Leads To Restrictions on Chargebacks911, Prohibits Deceptive Efforts to Stop Consumers From Reversing Disputed Charges

:grimacing: Sellers, beware out there!

We’ve seen friendly fraud awareness raised for Q4 2023, addressing two types of fraud where purchases have actually been made by the account holder: return fraud and illegitimate chargebacks.

If you didn’t know, there are companies who offer chargeback mitigation services for Sellers, purporting to fight intentionally or unintentionally illegitimate chargebacks from Buyers and protect the Seller from fraud. This type of service is attractive to ecomm retailers who process their own payments, either as a part or the total of their online sales. However, it’s also attractive to certain types of Sellers who get a lot of legitimate chargebacks.

Chargebacks911 offers chargeback mitigation services. Some of their Seller-clients were high-risk (i.e., lots of legitimate chargebacks) and/or running questionable business practices already. The FTC alleged that their own practices in defending chargebacks were questionable and fraudulent.

FTC, Florida Lawsuit Leads To Restrictions on Chargebacks911, Prohibits Deceptive Efforts to Stop Consumers From Reversing Disputed Charges

Chargebacks911 would knowingly submit inaccurate defenses to credit card companies on behalf of their Seller-clients to thwart legitimate Buyer chargeback claims. It also covered up for clients who were intentionally circumventing risk-tracking measures by banks and other watchdogs, such as how frequently chargeback claims were submitted and/or won by Buyers.

More info:

Sounds like a business Ed would run. Could have been a legitimate business filling a legitimate need, but that all went overboard when they found out how much more money they could make helping the other sellers.

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