Hi,
OK so as not to make this too long I will just post the questions and answers you put forward to me…
1) How does a Chargeback actually happen? Is it initiated by the player or by the monetary financial institution involved, or can it be either one ?
Let’s start with the basics, you can find a definition of charge backs anywhere in the web, and they can vary a lot.. let’s go with this one: “The reversal of a previously Settled transaction in which the merchant bank debits the amount of the sale from the merchant’s account because the cardholder has disputed the charge.” The term refers most the times to credit cards, but it can apply to other different methods, such as Ewallets/Echecks/etc
2) If a Chargeback is initiated by a player, what is the typical justification for doing so ?
The most common reason is when a player claims the credit card was stolen and that he/she did not make such deposits into “X” account(s)
3) If a Chargeback is initiated by a financial institution, what is the typical justification for doing so ?
It would most the times be for the same reason, the financial institution is contacted by one of their customers, stating that they did not make those transactions, hence disputing the charges made.
3.1) Chargebacks or recovery cases can be started by us as well, that happens when we are unable to collect money from Echeck or other Ewallets, in which cases the account gets closed, and the process is started to see if money can be recovered.
4) Why is Chipleader/AP/UB so agreeable to offering back Chargebacks to players ? Are there legal reasons for doing so ? Is it concern about damaging the Brand name ? Does Chipleader/AP/UB fight it at all, or merely acquiesce when faced with a Chargeback ?
Is not so much that we agree, is that legally, any person has up to 6 months to dispute a charge made to their credit card. Most of the cases are made by fraudulent players, and in any cases, AP/UB/ fight it all to see if money can be recovered. It is quite a process not only for the company, but to the account holder, as they need to demonstrate that they actually did NOT make a given transaction.
5) If a Chargeback is assessed against a player (and resulting against affiliates), are the players automatically disabled/closed from the AP and/or UB systems ?
When notification of a chargeback is received, AP/UB analyses each case, and proceeds accordingly, by closing the account, and contacting the player to see what the problem was. The accounts remain closed until a resolution is found, in cases like Echecks, the issue was caused by an error on a name, and/or insufficient funds to back-up the check, and once the player clears the situation, Security department confirms, and they decide whether to accept the player back or not.
6) Does a player have a recourse for paying back a “chargeback” ? Has this ever occurred ? If so, how are the effected affiliates notified of this ?
Yes, paying the money back is always an option for the player, that way his name/account is clear, and he can continue doing business with AP/UB.
Yes it happens, and Affiliates are notified same way as they were originally charged for that player, by applying a credit to their monthly affiliate payment.
7) Typically, what monetary institutions are involved, when a Chargeback is involved ? Is it strictly Credit Card companies or what ?
It can vary from Credit Cards, and/or any other institution that processes money, via Echecks/Ewallets/Debit Cards/etc
Is it true that at any juncture, Chargebacks can go back 6 months in time ? Initially, I was told (not by Alex), that there would be a 6 month window with Chargebacks from its time of inception, and then it would be strictly an ongoing month-to-month proposition. Is this not correct ?
Chargebacks are placed as they occur, on a monthly basis, what happens is, that any player has up to 6 months to present a chargeback, so for instance, a player who makes a deposit in November 2009, has up until Around May 2010 to claim/dispute the charge made. But then, the chargeback (if it happens) would be placed on the month that the notification was received, which is different for every single case. Chargebacks are allocated on an specific calendar-month basis, as it happens with affiliate payments.
9) What are Chipleader, AP, and UB doing proactively, to prevent Chargebacks ?
We’re in constant revision and analysis of depositing and/or playing patterns, in order to see any unusual behaviour from a player, or group of them. Many times players are associated to others, to commit fraud (commonly known as Fraud Rings) while some others act on their own.
10) From an affiliate perspective, are Chargebacks strictly calculated against revenue earned ? Are Deposit fees assessed to affiliates for US deposits, deducted from these Chargebacks, to avoid a double-dipping penalty ?
Yes, we currently deduct from the affiliates ONLY the amount that was originally paid to them, on the revenue generated by the “fraud player”, calculated from the date of the deposit, until the date of the chargeback notification. (NOTE Starting December 1st, the calculation will change so that the chargeback amount is deducted from the affiliate’s Gross Revenue, regardless of the amount originally paid for that player)
Deposit fees are deducted from US players ONLY, and are separate from any action taken related to chargebacks.
This is not a double-dipping penalty, as both processes are not related, in terms of transaction fees… for example if a player deposits $100 via credit card, we get charged with a fee regardless of the fact that the amount was later charged back … we need to pay for that fee even if it was later deemed as an fraudulent deposit.
11) As an affiliate, what can be done (if anything) to prevent these Chargebacks from occurring both now and in the future ?
What affiliates can do, is establish their own controls, and/ or filters in terms of which players they accept or not, even though it is difficult to know if a player will ever make a chargeback, there are countries known to be producing higher fraudulent traffic that others might. It is always important as well for the customer to know their players, and check their playing and/or depositing patterns.
12) Why can’t Chipleader be proactive in sending out reports to affiliates to let them know current chargebacks, rollover chargeback charges, etc. ? It seems that it takes a lot of effort on the affiliate and AM side both, to actually get the on-demand reports sent out.
Reports are currently made manually, and we are in the process of adding this information into the backend, for affiliates to check what players have a chargeback or not, on any given month.. that we are soon launching this feature, but in the meantime we will send out info upon request.
Alex