A bank card is not only a convenient payment instrument compared to cash. This high-tech banking product allows you to protect the cardholder from possible technical problems, default on the part of the seller or fraud due to chargeback - a procedure for challenging and returning a payment, the rules of which are clearly defined by the operators of the international payment systems Visa and MasterCard. If the cardholder has a disputable situation, then he has the opportunity to initiate the procedure for the return of the operation with which he disagrees. In the article we will tell you what a chargeback is, how it will help protect your rights and return your hard-earned money in the event of a controversial operation, and is it always possible?

Chargeback. What it is?

Chargeback (translated from English as "chargeback" - payment refund or chargeback) is a procedure for contesting (protesting) a payment from the acquiring bank (payee) in order to return it to the client's card account. The initiator of such a procedure is usually the “affected” cardholder, but it can only be launched by the issuing bank (which issued the card) in accordance with a strictly regulated procedure, the rules of which are established by the international payment system (hereinafter referred to as the IPS), we are talking about Visa and MasterCard. A refund is possible only if you paid with the card of the mentioned payment systems and the reason for the refund satisfies a certain number of criteria. It is an internal procedure between the banks participating in the payment system, in which its operator acts as an arbitrator (judge).

The issuing bank, in accordance with the rules of the chargeback, is obliged to accept an application for a refund of funds on a disputed transaction from the affected client, otherwise it violates the rules of the payment system (all banks participating in the MPS must comply with them without fail), which is fraught with punishment in the form of warnings and fines from the Ministry of Railways.

In any case, banks, in accordance with Article 9 (Procedure for the use of electronic means of payment) of the Federal Law of the Russian Federation of June 27, 2011 No. 161-FZ “On the National Payment System”, are obliged to:

• consider the client's application and provide him with the opportunity to receive information about the results of the consideration of the application within a period of not more than 30 days (clause 8) - that is, the application for a chargeback from the client must be accepted by law;
• reimburse the client for the amount of the operation performed without the client's consent after receiving the appropriate notification from the client (clause 12). The client must notify the bank, however, no later than the next day after he was informed about the disputed transaction (clause 11) - this is not entirely related to the topic of the article, but shows that not only at the level of the Ministry of Railways, but also at the legislative level the client is protected from fraudulent transactions (another question is how such protection is implemented?).

The chargeback has a limited time frame during which the client can file a complaint with the acquiring bank, and the latter will (if it deems it necessary) start the return procedure (details below). On average, you need to focus on 120 days from the date of purchase of a product or service. Further, we will give the terms using the example of the Master Card refund guide (they are not specified in a similar document from Visa). By the way, the volume of this manual is 418 pages of text in English.

The maximum time for submitting an application depends on the reason for the return and in some cases on the amount of the product / service. For example, if a product/service is of poor quality or does not match the manufacturer's description, then the maximum time for protesting a payment for a product/service reaches 120 days (from the date of settlement, delivery or refusal). And if the service has ceased to be provided, then no more than 120 days must elapse from the date of interruption of the service and no more than 540 days from the date of the transaction (purchase).

Reasons for a refund

Here are some examples of controversial transactions that may be the basis for launching a chargeback:

Credit card fraud. In this case, funds are debited from the account without the consent of the holder, as a rule, due to compromise of the card. See the main types of fraud.

Errors in payment processing. This can be technical errors both on the side of the outlet during the receipt and primary processing of the payment (failure in the POS terminal), and on the side of the acquiring bank, issuer or IPS, as well as accidental (possibly intentional) errors as a result of actions cashier or seller (human factor). A typical example of this is . Another example is the write-off of an amount greater than the cost of a product / service.

Problems can also arise between the acquirer and the issuer (the internal "kitchen" of banks). For example, the payment for the purchase went through without authorization of the payment from the issuer (unauthorized payment, i.e. without approval), and the acquirer nevertheless sent the issuer a financial confirmation of the transaction (clearing). The situation is similar when the clearing for a specific transaction is higher than its amount at the initial authorization. All this is a reason to initiate a refund procedure.

Dispute between the buyer and the outlet. Goods or services are paid in full, but not received by the buyer, or received, but do not meet the declared characteristics (or the service is not provided in full). This also includes the situation when the seller did not refund the buyer (did not return the money for returning the goods).

When a bank sends a chargeback request to an acquiring bank, it must indicate the reason for the chargeback. Each payment system has its own classification of such reasons (the term “reason code” is the reason code), which the issuer will be guided by. For example, to re-debit the reason code for MasterCard - 4834, and for Visa - 82. Or for an operation for which money was debited without the knowledge of the cardholder (that is, there was fraud, fraud), the reason code for MasterCard - 4863, and for Visa - 81. All reason codes can be found in the rules of procedure of each IGC.

The procedure for making a chargeback

1. We prepare documents for applying to the issuing bank

So, first of all, we collect evidence of our innocence. What can be used as evidence? Yes, absolutely everything that you can present:

• printouts of card transactions;
• a screenshot of the product description page or your personal account;
• any correspondence (including electronic) with the seller, from which it clearly follows that it was not possible to resolve the conflict peacefully;
• photographs of the defective product;
• video recording of the moment of opening the parcel;
• and everything, everything that is at your disposal, because sometimes a seemingly insignificant trifle turns out to be decisive.

2. We submit an application to the issuing bank in free form (or on the letterhead of the bank)

When all possible evidence has been collected, go to the bank that issued your card. You can, of course, send an application by fax or, but a personal visit is always more reliable. You never know what paper may be missing! Provide it immediately on the spot or wait for a written notification of an incomplete package of documents - which is faster? Moreover, the deadlines also need to be remembered. The issuing bank will review the application and either accept it or refuse to protest the transaction if it considers that the basis for the return does not meet the requirements of the IGA.

After the application is written and accepted by you, your bank is connected to the case, and you just have to wait. Further events develop according to the scheme approved by the Ministry of Railways.

3. The issuing bank transmits the claim to the acquiring bank through the IPS. He considers the essence of the requirement and, if he agrees with it, makes a reverse payment to the card of the “victim”. Otherwise, the request is sent to the trade and service enterprise (TSE). The merchant must provide the necessary evidence that the service paid for by the “victims” was provided in full and on time. If evidence is not provided, the acquirer returns the payment, and the payment amount is debited from the merchant's account without acceptance, and all associated costs (chargeback penalty, transaction fee, etc.) are borne by the merchant.

4. In case of disagreement, the acquirer sends a refusal to the issuer, the so-called re-submission (in other words, beats off the chargeback). This, according to the rules of the IPU, is given 45 days. If the bank does not meet the deadline, then a refund of the payment is practically guaranteed.

5. The issuer has the right to send its request for a refund of funds again within 45 days. The victim may have additional evidence of his innocence. In this case, the payment system is included in the dispute as an arbitrator (arbitration begins), which will resolve the situation in accordance with its own rules. This process takes no more than 45 days, after which the Ministry of Railways makes a decision on the return or refuses it.

Any normal merchant is interested in reducing the number of such return procedures, although the reasons for the return may be different, both technical failures (double write-offs), and unintentional erroneous actions of the outlet staff. If the number of protested transactions exceeds the norm (a certain percentage of the total number of transactions), then the merchant may have problems with the acquiring bank (fine or denial of further service). The fact is that acquirers are controlled by payment systems, which can be punished with a fine for too many chargebacks. After all, this suggests that banks provide acquiring services to outlets with a dubious reputation.

That is why the TSP is better to agree to when the money is returned by the seller on his own initiative if he cannot fulfill the terms of the transaction. In this case, only the parties to the transaction participate in the dispute, without the involvement of banks and the payment system.

Reasons for refusing chargeback. What to do?

Refusal to protest a payment may be due to several reasons. There could be a missed time during which the initiation of the procedure is possible, or the victim does not have enough evidence to form a claim for a refund. Often banks simply do not want to deal with such problems (lack of knowledge of local staff or they are incompetent to deal with such issues?). In any case, you must accept your application, as we discussed above. Otherwise, make a complaint about the illegal actions of employees (to the bank, to the Central Bank, to the MPS operator, on well-known banking sites) - this will go faster.

Don't limit yourself to a single attempt. Try to contact the management of the branch, or visit the central office of the bank. Your main task is to ensure that your application is accepted and "set in motion", and then it remains only to wait for the results.

In the life of any of us, there have been cases when the seller made a mistake when paying with a card or had to return a low-quality product. And what if, even worse, the bank's client faced fraud?... To help solve such cases so that they do not turn into a "going through the throes", and our article from the series "Fingramot with MTBank" is sent.

Traditionally, Nadezhda Denichenko, Head of the Card Center of the Retail Operations Department of MTBank, helps us.

Disputed transactions can be divided into non-fraudulent(those operations that were carried out by the cardholder or with his knowledge, but the client does not agree with them for any reason) and fraudulent(that is, transactions in which the cardholder did not participate and did not authorize them).

Let's consider each type of disputed transactions and start with everyday ones: practice shows that our citizens are more likely to encounter situations that are more related to the human factor.

In the practice of any person, there are cases of disputing the amount of the purchase(for example, a person took three bottles of milk, and he was counted four). Or it may be about discovering the marriage upon returning home.

In the case of cash payment, everything can be quickly resolved on the spot - the main thing is that the receipt be kept.

Difficulties may arise when paying by card - in this case, the sellers begin to refuse to cancel the operation, citing some mythical difficulties. However, this is not the case - the operation can be canceled.

So, if such an unpleasant situation has occurred, then first of all the client can (and should) try to resolve this situation with the outlet on his own, since only she can cancel the transaction that has already been completed. The bank cannot do this, since, according to the rules of the Ministry of Railways, it is obliged to accept successful authorization for processing and debit the funds from the client's account.

In this case, the seller or the store administrator can solve the problem in different ways: either return the difference in cash, or cancel the wrong operation and carry out a new one.

The main snag of the store staff with the cancellation of the operation is that the sellers or cashiers do not know what to do in this disputable situation. Although acquiring banks are required to provide their merchants with instructions that indicate the algorithm for the cancellation procedure. Thus, if the seller cannot or does not want to cancel the transaction, then he must be asked to act according to the instructions of the acquiring bank or make a call to the bank for advice.

Subject to the correct cancellation of the operation, the money should be returned to the buyer's account within 5-7 days.

If it is not possible to establish contact with the outlet or the outlet refuses to resolve the situation, the client can contact the issuing bank and write an application to protest the specified operation. It will be very good if the client managed to keep checks / receipts / correspondence / other documents confirming the transaction and containing the “correct” amount of the transaction. Otherwise, it will be extremely difficult to prove the validity of the client's claims and the outcome of the protest will rather depend on the integrity of the outlet.

The time for solving the problem in this case is declared in the contract concluded between the client and the bank. It specifies the period during which the client must, in case of disagreement with the account statement, submit a claim to the bank. If the client does not do this in a timely manner, the bank has the right to refuse to consider the application.

In addition, the rules of the IGA also provide for maximum time limits for protesting transactions. In most cases, they are 120 days, but in some cases less. And only in case of dispute of payment due to non-receipt of goods/services, this period can be up to 540 days, subject to a number of conditions.

After these deadlines, the issuing bank will simply not have the opportunity to even try to protest the transaction disputed by the client.

The period required for the bank to conduct an investigation/protest of a payment may vary significantly depending on the situation and the list of actions taken, but, as a rule, does not exceed 90 days. It is clear that the term for considering a disputable situation in the bank's structure will be significantly less than the holding of an international appeal under the procedures of the IPS.

You also need to understand that when conducting arbitration proceedings in the Ministry of Railways, the time limits increase significantly.

Another common situation is when receiving cash at an ATM or cash dispensing point, the cardholder did not receive the requested amount or the received amount differed from the requested one (including upwards). Here the client needs to contact the issuing bank and write a statement with a detailed description of the circumstances of the situation. The bank will conduct an investigation and, in case of confirmation of the fact of a failure / error, will credit the funds to the client's account.

The same story with self-service devices. If the cardholder replenished the account or made a payment through the information kiosk, but the funds were not credited to the account or transferred to the service provider, then you need to contact the issuing bank and write an application.

If the client, due to his negligence, forgot money at an ATM or did not wait for their issuance and they were taken by another person after his departure, then in such a situation it is necessary to contact the police department for an investigation in accordance with the law. The bank, in turn, will provide information support to the investigating authorities by providing all the necessary data and video surveillance footage.

Now let's talk about unauthorized operations.

If the client discovered that someone performed actions with his account without his knowledge, then first of all it is necessary to immediately block the card through which these operations are performed. Information on how this can be done is contained in the agreements, on the bank's website, and must be communicated to the client at the time of issuing the card. In addition, the phone numbers of the 24-hour support service for holders are contained on the back of any card.

Next, the client needs to contact the issuing bank within the time period specified in the agreement (but it is better to do this as soon as possible) and write an application to protest these transactions. In addition, depending on the situation, the bank may need other documents, for example, a copy of visa stamps from the passport, indicating the location of the client at the time of the disputed transactions, and others. Of course, it will be necessary to provide and return the compromised card to the bank.

Further, the bank will consider the received application according to the established procedures: conduct an investigation, request documents confirming the transaction from the outlet (if appropriate), protest the operation according to the MPS procedures (if possible and appropriate).

Often, during the investigation, the bank manages to establish the fact of the so-called "friendly fraud", that is, the involvement of relatives or acquaintances of the client in the commission of disputed transactions. And it happens that the client himself “forgot” something. In this case, the bank will offer the client to continue the proceedings on their own or with the help of the Department of Internal Affairs.

If the bank failed to protest the transactions, then the bank may consider the issue of reimbursement to the client of unauthorized debited funds at the expense of the bank. And here, of course, the role will be played by how conscientiously the client followed the rules and followed the recommendations of the bank to ensure the safety of their own funds.

If the unauthorized use of the card occurred on the territory of our country, the client also has the right to contact the Department of Internal Affairs for an investigation in accordance with the law.

Earlier in the "Financial Literacy" cycle with MTBank

Benefits for company management and accounting

Stanislav Chernyak, Head of Claims Department of URALSIB Bank I stage– Measures related to risk management, i.e. monitoring of suspicious transactions, detection of fraudulent transactions, taking measures aimed at preventing them, informing payment systems, etc.
II stage– Carrying out claims work on past fraudulent transactions.
Stage III– Work on attributing the amount of fraudulent transactions to losses or insurance (if it is impossible to attribute losses to cardholders or outlets).

All three stages are closely interconnected. So, if the department responsible for risk management promptly identified and efficiently worked out fraudulent activity, then the employees responsible for carrying out claims work will have to carry out a protest procedure for a smaller number of successful fraudulent operations. In turn, the better the claim work is carried out, the smaller the amounts are attributed to the losses of the bank, its customers or insurance companies. There is also feedback. Sometimes the risk management department receives information about fraudulent transactions that are difficult to detect during the monitoring process directly from the claim department that accepted the corresponding client's application. In addition, carrying out claims work specifically on fraudulent transactions requires the mandatory generation of messages through the SAFE and FRS systems, which is part of the functions of risk management.

Within the framework of this article, we will pay special attention, first of all, to the second stage, namely, to the question of how, in our opinion, claim work on fraudulent transactions should be carried out, since often a well-organized claim work (in this case, the luck factor sometimes works) allows reduce or even avoid financial losses.

Stanislav Chernyak - Head of the Claims Department of OAO URALSIB. He oversees such areas of the bank's activities as claims handling, client support, risk management, and increasing the competence of the bank's specialists in these areas. He joined URALSIB in 1997, starting his activity in the direction of developing the bank's card business. Previously, he held positions at Avtobank and Avtobank-Nikoil. Born December 24, 1976. He has a diploma from the Accounting and Finance Department of the Moscow State University of Commerce under the Ministry of Foreign Economic Relations of the Russian Federation.

Turning to the original source

So, the first thing you need to pay attention to when carrying out claims work on fraudulent transactions is the fundamental principles of the division of responsibility for fraudulent transactions between the acquirer and the issuer, which are followed by Visa International and MasterCard Worldwide payment systems. In accordance with the current concept, the issuer is responsible for all fraudulent transactions, except for transactions in the field of e-commerce and MOTO (first of all, we mean transactions with lost, stolen and counterfeit cards). With regard to liability for transactions with counterfeit cards, the main losses from which are borne by issuing banks, the relevant provisions can be found in the manuals VIOR VOLUME I (chapter RISK MANAGEMENT, section Counterfeit Losses) and Security Rules and Procedures (chapter Fraud Loss Control Standards, section Responsibility for Counterfeit Loss). Responsibility can be transferred from the issuer to another participant in the transaction only in the event of proven violations of the rules of payment systems that have taken place, as a result of which it became possible to carry out a fraudulent transaction. General arguments that the client, for example, was at the time of the transaction in another country, are not accepted by payment systems as such evidence - the issuer needs to prove the violation by the acquirer (or its outlet) of a specific paragraph of the rules. This can also include the transfer of responsibility within the framework of special programs, i.e. various Liability Shifts, which we will return to later. Thus, if the actions of the acquirer were recognized as correct, then it is almost impossible for the issuer to challenge the fraudulent transaction. Fortunately for issuers, as practice shows, acquirers regularly make mistakes, and the issuer's task is to find such an error and correctly use it.

Standard protest methods

Turning to the consideration of the actual procedure for conducting claim work, we distinguish two ways: standard and non-standard. Standard refers to protesting operations for reasons that are described by Chargeback codes and Compliance cases. In the standard version, it is preferable to use those codes, the application of which requires the least effort. Of course, not to the detriment of the quality of the claim work.

First, let's consider the procedure for protesting a fraudulent operation with the presence of a card and its holder (Card Present), which was played by a fraudster, because protesting transactions in the field of MOTO and Electronic Commerce related to Card Not Present transactions has its own characteristics and will be discussed a little later.

First of all, it is necessary to generate and send messages about fraudulent transactions through the SAFE and FRS systems. In addition to fulfilling the requirements of payment systems, in some cases, the issuer may receive a message about the right to protest the operation in connection with the location of the outlet where the fraudulent transaction took place, in the list of outlets for which the so-called chargeback window is open (code 93 Visa and 4849 MasterCard). As practice shows, sometimes this may be the only way to challenge such operations as, for example, payment for toll roads, bridges, tunnels, etc.

Then it is advisable to check if there are any violations that allow the use of Chargeback codes from the “authorization” and “processing” groups.

In accordance with the current concept, the responsibility for fraudulent transactions, except for transactions in the field of electronic commerce and MOTO, is borne by the issuer

Essentially, the following questions need to be answered:

2. Was the card included in the bulletin of seized cards at the time of the sub-limit transaction? (possibility of using codes 70 Visa, 4807 MasterCard);

3. Has an operation been performed on an expired card? (possibility of using codes 73 Visa, 4835 MasterCard);

4. Is the transaction submitted for payment on time? (possibility of using codes 74 Visa, 4842 MasterCard);

5. Is there a double processing operation? (possibility of using codes 82 Visa, 4834 MasterCard);

6. Are the rules for conducting an operation in a CAT device violated? (possibility of using codes 96 Visa, 4808 or 4847 MasterCard).

The advantage of using all of the above codes is that they guarantee the appeal of the transaction with almost 100% probability with minimal effort: there is no need to request copies of the documents for the transaction, as well as send supporting documentation (except for MasterCard code 4847).

If none of the “authorization” and “processing” group codes match, and the card is a chip card, you need to check if it is possible to protest the transaction under the current provisions of the Liability Shift program for fraudulent transactions with chip cards. “Liability Shift” means the transfer from the issuer to the acquirer of financial responsibility for fraudulent transactions that took place with a chip card in a terminal (POS or ATM) that does not support chip cards, and confirmation of a trading transaction with a PIN code. Payment systems in special manuals describe in sufficient detail all the processes associated with migration to a chip. It is important for us to pay attention to the following points. First of all, you need to know that Liability Shift does not operate worldwide, but only in those regions that have declared some degree of participation in the Liability Shift program. At the same time, if a region within a particular payment system announced the implementation of Liability Shift, this does not mean that all issuers from other regions have the right to protest transactions in this region under Liability Shift. To do this, it is necessary that an appropriate agreement be signed between the regions or, as in the MasterCard Worldwide payment system, the region must declare participation in the Transitional Chip Liability Shift program. With regard to Russian participants in international payment systems, it should be borne in mind that today Visa Liability Shift is valid only in the CEMEA and Europe regions, and for ATM transactions only between participants from the CEMEA region. MasterCard Liability Shift is valid in Europe and Malaysia. As the process of expanding the Liability Shift program is actively developing, it is necessary to constantly monitor changes in order to know for sure whether the issuer has the right to object to a fraudulent transaction for a "chip" reason.

The second point is related to the fact that today, in a number of cases, clarifying the issue of the possibility of protesting a transaction within the framework of Liability Shift requires a serious analysis of the transaction, namely: card and terminal parameters, what type of fraudulent transaction went through the card, whether the PIN code was checked in online or offline mode, and whether the PIN code was checked at all, whether there was a Fallback, etc. For this, payment systems have prepared special flow charts, following which you can determine who is responsible for the fraudulent operation (Visa CEMEA Member Letter 02/04 “Chip migration – liability shift” and MasterCard Europe Edition Operations Bulletin, No. 10, October 2004) . However, it is often difficult to get an answer to a particular question of a flow chart, since it depends on the specific values ​​​​of the fields of authorization and transaction messages, i.e. it is necessary to understand the message formats and know in which field the value we are interested in is located. Data on the fields of interest to us and their values, obtained from various information letters and manuals of payment systems, are summarized in Table 1.

As such, determining whether it is possible to contest a transaction under Liability Shift can be a difficult task. The only consolation here is that today it is very rare to subject operations to deep analysis, since in the vast majority of cases it turns out that the acquirer does not support the chip at all. The following codes are used to protest a transaction for a “chip” reason:

1) counterfeit card transactions - 62 Visa, 4862 MasterCard (non-ATM transactions), 4870 MasterCard (ATM transactions via MasterCard and all transactions via Cirrus/Maestro; from April 2007 code 4870 can also be used to protest non-ATM transactions via MasterCard);

2) operations on stolen, lost, non-received cards - 81 Visa, 4837 MasterCard (from October 2007 a new code 4871 is introduced).


If none of the codes of the “chip” group is suitable for protesting the operation, you need to request copies of the documents for the operation. By the way, if we are talking about a falsified magnetic stripe card, then before requesting documents, it is worth checking whether information was transferred to the issuer during the authorization process from the second and first tracks of the magnetic stripe of the card. If not, then you can use the same codes 62 Visa, 4862 MasterCard. Let's go back to the requested copy. Firstly, the acquirer may not provide the required copy at all, and then you can safely use the 81 Visa and 4837 MasterCard codes. If a copy is submitted, you must check:

1) Is the correct document provided by the acquirer? (possibility of using codes 60 Visa, 4802 MasterCard)

2) Does the currency of operation and transaction match? (possibility of using codes 76 Visa, 4846 MasterCard)

3) Is there a cardholder's signature on the transaction receipt? (possibility of using codes 81 Visa and 4837
Mastercard; MasterCard rules provide the right to issue a chargeback under code 4837 without first requesting a copy)

4) was the fraudulent transaction carried out at the same point where the transaction was previously carried out by the legitimate cardholder? (possibility to use codes 57 Visa and 4840 MasterCard; MasterCard rules provide the right to issue a chargeback using code 4840 without first requesting a copy)

5) Was the transaction amount split into several “sub-limit” amounts in order to avoid online authorization? (possibility to use the standard Compliance case)

6) How different is the cardholder's signature on the check from his signature on the card? (possibility to use the standard Compliance case)
The last of the listed standard Compliance cases is worth talking about in more detail. For clarity, consider an example from real practice. Our bank received Pre-Compliance, in which the issuer claimed that the point of sale did not verify the signature on the check and on the card, while the signature samples differed from each other (Fig. 1 and 2).
After a short analysis of the situation, it was decided to refuse the issuer, and here's why. The fact is that payment systems recognize the legitimacy of Compliance only in cases where there is no doubt that there is one name on the signature strip and a completely different one on the check. For example, the card clearly says "John Smith" and the receipt reads "Ivan Smith". In our case, there are only two “squiggles”, and the parties can argue for a very long time and to no avail, whether they differ or not, whether the two “squiggles” belong to the same person or not. Only handwriting expertise can put an end to this dispute. It is clear that payment systems cannot afford such a luxury. Therefore, in most cases, the fault of the acquirer will not be considered proven, and the decision will be made against the issuer.

This, in fact, exhausts the issuer's ability to protest fraudulent transactions using standard methods. If the issuer does not come up with any non-standard move, then the amounts can be attributed to bank losses or insurance.

Claim work on MOTO and Electronic Commerce operations

Claim work on MOTO and Electronic Commerce transactions requires separate consideration due to their inherent features, such as the absence of a card, client signatures, 100% authorization, etc. When protesting fraudulent MOTO and Electronic Commerce transactions, first of all, it is necessary to check whether whether during the operation of the 3D-Secure or MasterCard SecureCode system. The fact is that when the acquirer uses these systems, Liability Shift is triggered, similar to the “chip”, but at the same time, responsibility is transferred from the acquirer, which traditionally bears the main losses from fraud in transactions of this type, to the issuer. To determine the use of 3D-Secure or MasterCard SecureCode, you need to know the values ​​of the following fields of the authorization request:

1. For 3-D Secure
a) the value “05” or “06” in field 60 of positions 9–10 (Mail/Phone/Electronic Commerce and U.S. Bill Payment Indicator);
b) the presence of an entry in field 126.9 (3-D Secure CAVV), if both the issuer and the acquirer support 3-D Secure.

2. For MasterCard SecureCode
a) the value “1” or “2” in subfield 42 (Security Level Indicator) of field 48;
b) the presence of an entry in subfield 43 (UCAF) of field 48 if both the issuer and the acquirer support MasterCard SecureCode.

If the fraudulent operation went through without the use of the above systems, then the case can be considered almost won, and you need to choose the easiest way, that is, first get answers to the following questions:

2. Is the transaction submitted for payment on time? (possibility of using codes 74 Visa, 4842 MasterCard);

3. Is there a double processing operation? (possibility of using codes 82 Visa, 4834 MasterCard).

If none of these codes match, 83 Visa or 4837 MasterCard codes are used. Rice. 1 Fig. 2 A few words about protesting fraudulent transactions with "non-chip" cards at ATMs. Setting Chargeback by 90 Visa and 4859 MasterCard codes may seem completely unpromising, however, as practice shows, you should not even neglect this possibility, because you might just get lucky. Concluding the story about the standard methods of protest, it is necessary to mention the “acquiring” side of the claim work. Unlike the issuer, the acquirer does not need to figure out how to protest the operation, but only “fight back” according to the code that the issuer has chosen.

In most cases, if the operation is authorized, submitted for payment correctly and on time, there is a signature on the check, and it complies with the requirements for CHIP/PIN/3D-Secure/MasterCard SecureCode, then it is almost impossible for the issuer to protest the operation. If the acquirer did make a mistake, and the Chargeback is legitimate, you should try to find errors with the issuer itself. For example, check if the client really has an overdraft due to a late submission, if a message has been sent to the SAFE/FRS system, etc.

Non-standard methods of protest

As mentioned above, if none of the standard protest options described above are suitable, the issuer may try to follow a non-standard path. By a non-standard option, we mean filing a claim with an acquirer due to a violation of one or another clause of the rules of payment systems, which is not described by standard Compliance cases or Chargeback codes. The claim is made through the same Compliance procedure, and the choice of reason depends on your imagination, combined with a good knowledge of the rules of payment systems. Often this is a bluff, designed to intimidate the acquirer by filing a case with the Arbitration of the payment system with the subsequent payment of commissions in case of loss. The acquirer's task is to competently understand the situation and confidently respond, in order, in turn, to sow seeds of doubt in the issuer about the advisability of filing a case with Arbitration. Thus, it all depends on how well the parties argue their position and interpret the rules, which in each case "where you turned, there you went." Naturally, there is a risk that if the matter goes to arbitration, the arbitration committee may interpret the situation in its own way and not in your favor. There are situations when the same situations are interpreted either in favor of the issuer or in favor of the acquirer. I would like to give a few examples from practice that will better characterize the subject of the conversation than general reasoning.

Case 1. Standard situation: several transactions on a fake “non-chip” card carried out in the UK are authorized, correctly presented for payment, the required data from the magnetic stripe, signature, etc. are fully transferred. In general, there is nothing to complain about. However, some time later, a confiscated counterfeit card was received in the mail (Fig. 3–4). The fake turned out to be of poor quality, but this was not enough for the “accusation”. However, the card was missing a prefix - four digits printed under the card number and matching the first four digits of the card number. Pre-Compliance was sent to three acquiring banks indicating a violation of paragraph 5.5.B (VIOR vol.1). In the "load" it was indicated that the special character "V" also does not meet the standards. The two banks agreed and refunded the amounts of the transactions. However, the third bank refused. Acquirer argued the refusal by the lack of evidence that this particular card was used in his outlet. According to the acquirer, a card was presented at the point of sale that met all the requirements of the payment system. We could not prove the opposite (sometimes several fake cards are used at the same time) and we were forced to give up our claims. This case demonstrates very well that it is not always possible to beat everyone and not everyone.

Case 2. A curious case. The operation of issuing cash for a large amount on a fake card. In response to a request for documents, the acquirer, along with a copy of the check, for some reason provided a clear photocopy of the holder's passport and his card (the latter also lacked a prefix and a special symbol). In this case, it was not necessary to prove that this card was used. The Acquirer agreed to the Pre-Compliance due to a violation of clause 5.1.D.1.a (VIOR vol.1).

Case 3. Fake card again. One of the features of this case is that a transaction for a large amount was broken up by the acquirer into ten separate transactions. Each of the transactions was authorized, all the rules of payment systems were observed. However, the issuer filed a claim using the standard Compliance reason - Split Transaction. The acquirer was blamed for the following - by breaking the transaction amount into several parts, he avoided one authorization for a large amount. At the same time, the issuer claimed that if the operation had not been split, then the system would automatically send a response to the authorization request about the need to contact the issuer (Call Issuer). Thus, it would be possible to avoid the passage of a fraudulent operation.

Ultimately, the case was considered by the arbitration committee, which sided with the issuer. I confess that this case is not from our issuer practice, but we, in turn, faced a similar situation as acquirers.

Case 4. The issuer received the same Pre-Compliance as in Case 3. To be honest, the standard Compliance Split Transaction reason describes a situation where transactions are split in order to conduct several sub-limit unauthorized transactions, and not to avoid authorization for a large amount. It was possible to respond to the issuer in this way, but we knew what decision the payment system made earlier in a similar situation (see case 3). We didn’t want to take risks, and we decided to check whether the issuer really has set limits, when exceeded, a refusal is generated by the Call Issuer code. A real-life card of the same BIN was found, and an operation for the total amount was carried out through a virtual terminal with a similar MCC.

As expected, we received a positive response, not a Call Issuer. Thus, the issuer "cunning", which was reported to him in our reply. The resulting authorization, of course, was immediately revoked. The case was never sent to Arbitration ...

Case 5. Another example of a “non-standard” approach. As part of an investigation into a fraudulent outlet, we were contacted by a representative of one of the affected issuers. In an informal conversation, we reported that this point really carried out fraudulent operations, talked about the measures taken, preliminary results. After some time, a three-page Pre-Compliance was received from the issuer, in which, with reference to our conversation, it was stated that the outlet carried out transactions with fake cards (i.e. without the participation of a legitimate client) and thus paragraph 5.3.F.1 was violated. a (VIOR vol.1). Not only does this paragraph say something completely different, the issuer also proved the fact of passing fraudulent transactions only by verbal confirmation from the acquirer, which cannot be attached to the case when considered in Arbitration. Therefore, in the response to Pre-Compliance, we wrote that the operation was carried out by the legal holder himself directly at the point of sale. In conclusion, I would like to emphasize that a non-standard approach is not only the ability to accuse and demand an ultimatum to return the amounts. Sometimes it is much more appropriate to apply with a letter of "Goodwill" (Good Faith), pointing out the violations committed by the outlet. This approach sets up colleagues in the shop to the desire to help whenever possible, and not to go on principle, no matter what it costs. This is especially true of relations between Russian banks. In our practice, there were many cases when, using Goodwill letters in favor of the injured party, it was possible to resolve such situations that would never have been resolved with the help of “hard” Chargeback or Compliance.

The entry was posted on November 3, 2016 by the author Vadim Fedorovich in the category

Date of the last update of the material: 03/19/2019

Introduction

We all use the VISA and MasterCard payment systems when replenishing accounts in brokerage companies or when shopping online/offline: we enter our bank card details, confirm the transaction, the money goes to the broker or seller, and we get the result — a replenished account/purchased goods. Or (oh, horror!) we don’t get it, it happens. What to do? How to return money? It's simple - issue a chargeback.

You can issue a chargeback yourself or through intermediaries. In the first case, you save money (you need to pay for assistance in registration), and in the second, your time.

Chargeback processing service

No time to study the issue? Contact us, we will help you arrange a refund and advise.

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What are we doing

Our specialization is the initiation and legal support of the payment contestation procedure: work with documents, interaction with banks and the Ministry of Railways.

Assistance in obtaining a chargeback in Sberbank, Tinkoff Bank, Gazprombank, Alfa Bank, VTB and other banks (return payment to VISA, MasterCard, MIR).

We will return money from online stores, brokerage companies (investing in Forex, binary options), HYIPs and pyramids, online casinos, airlines, hotels, fitness clubs. We'll give you a free consultation and complete all paperwork.

What is required of you

At this stage, one thing is required of you - a chargeback and expect a response message from the support service. We will consider your case, evaluate its prospects and contact you as soon as possible to inform you of the scheme of our interaction with you and to announce the approximate cost of all services.

Basic moments:

1. The disputed payment must be made from a bank card of the Ministry of Railways Visa, MasterCard (no more than 540 days have passed since the moment of payment), as well as the MIR PS (payment limitation period is 360 days).
2. The fee for registration of chargeback is negotiable, chargeback without prepayment is possible (an appropriate agreement is drawn up).
3. If you leave a request for a chargeback, do not ignore phone calls from unknown numbers (our specialists will call you).

Our work is described in more detail in the first comment under this article.

Do you want to become our partner – help people get their money back and make money on it? Write to us at chargeback@site

Please use the above contact details, and our specialists will review your case, draw up all the documents and send them to the bank.

Below we will consider in detail the algorithm for issuing a chargeback: we will give the reasons for initiating the procedure for protesting a transaction; we will indicate the terms during which a return payment is possible; list the documents required for issuing a chargeback; we will talk about possible obstacles (denial of chargeback, etc.) and warn you about the consequences of an unsuccessful payment protest procedure.

1 Chargeback as a way to protect your payments

Recommended reading In the modern world, in the age of electronic transfers to anywhere in the world, each of us runs the risk of parting with our money every day - running into a fraudulent seller when shopping in online stores, or replenishing an account with a “brokerage company”, the management of which will disappear after a week . I'm not talking about the fact that the seller or broker may go bankrupt. But!

We live in a civilized world, and it would be strange if large payment systems (MPS like VISA or MasterCard) did not protect their users' transactions from unscrupulous sellers and. The Ministry of Railways relieves us of responsibility for the unauthorized use of our cards in case of their loss / unauthorized use, regardless of the country in which these cards were issued. Their holders can get their money back through chargeback in cases of bankruptcy or fraud of online or offline stores, airlines, brokers, hypes, etc.

First of all, do not panic and initiate the chargeback procedure for any reason: if you don’t like the product/service and want to get your money back, it’s enough to ask the seller for a so-called refund (refund is a voluntary refund without involving the bank and payment systems), and only if the seller or broker for those or for other reasons, they refuse to return the money to you, we contact the issuing bank (the bank that issued the card for which we dispute the payment) with an application for a refund and an evidence base attached. And we are waiting for the decision of the bank.

How to conduct a chargeback yourself

A short step-by-step guide to the chargeback procedure - from requesting a bank statement to a refund.

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We carry out the chargeback on our own - step by step instructions:

1. We request the bank statement with the disputed card transaction.
2. We receive confirmation of an attempt to resolve the issue with the merchant: we leave a request for withdrawal of funds / ask the merchant to make a refund, wait 3 days, terminate the agreement concluded with the merchant with an official letter, and demand that the money for the paid goods / services be returned to our bank account (we fix everything).
3. We collect a package of documents: an agreement with the merchant, evidence of violations of the regulations, official news from the merchant's website, bank statement, extract from the payment system, correspondence with the merchant, a letter with the termination of the contract and the response of the merchant, printouts of calls, etc.
4. We write an application to the issuing bank for a refund in free form, where we talk about our situation and refer to the attachments in the right places (documents from clause 3).
5. We transfer the package of documents to the bank's specialists (after 30-60 days you will be contacted and notified of the decision: if it is positive, the chargeback is initiated, we are waiting for its results; if it is negative, we understand the reasons, make adjustments to the documents and the application, write complaints (if necessary ) and try a second time, taking into account the feedback).

If something goes wrong, you are always with us.

How electronic payments work

Before challenging an electronic payment, it is necessary to understand what electronic payment systems (EPS) are. Payment systems in general are physical and electronic infrastructure (ATMs, payment kiosks, POS terminals, cards with stored monetary value; electronic wallets) and related procedures and protocols that carry out financial transactions.

Codes of the main reasons for chargeback for VISA and MasterCard MPS

The international payment systems Visa and MasterCard cataloged the main reasons for disputing transactions and assigned them the appropriate chargeback codes.

Old Visa Chargeback Reason Codes - reason codes

Code	Meaning	Translation	Dispute period (days)
30	Services Not Provided or Merchandise Not Received	Service not provided or item not received	120
41			120
53	Not as Described or Defective Merchandise	Item not as described or damaged	120
57	Fraudulent Multiple Transactions	Multiple fraudulent transactions	120
62	Counterfeit Transaction	Fake transaction	120
70	Card Recovery Bulletin or Exception File	List of blocked or seized cards	75
71	Declined Authorization	Rejected Authorization	75
72	No Authorization	No authorization	75
73	Expired Card	Card expired	75
74	Late Presentation	Late grant	120
75	Transaction Not Recognized	Transaction not recognized	120
76	Incorrect Currency or Transaction Code or Domestic Transaction Processing Violation	Incorrect currency or transaction code or internal violation of transaction processing	120
77	Non Matching Account Number	Incorrect account number	75
78	Service Code Violation	Corrupted card validation code	75
80	Incorrect Transaction Amount or Account Number	Incorrect transaction number or account number	120
81	Fraud-Card-Present Environment	Card Presence Fraud	120
82	Duplicate Processing	Reprocessing	120
83	Fraud Card Absent Environment	Fraud without a card	120
85	Credit Not Processed	Loan not processed	120
86	Paid by Other Means	Paid in another way	120
90	Non-Receipt of Cash or Load Transaction Value at ATM or Load Device	Non-receipt of payment, failure to download the value of the payment at an ATM or device for replenishing the balance on loaded cards	120
93	Visa Fraud Monitoring Program	Visa Fraud Monitoring Program	120
96	Transaction Exceeds Limited Amount	Transaction amount exceeds the limit	120

New Visa Chargeback Reason Codes - reason codes

Code	Meaning	Translation	Dispute period (days)
10.1	Counterfeit Fraud	Fraud, associated with using fake cards	120
10.2	Non-Counterfeit Fraud	fraud, not associated with using fake cards	120
10.3	Fraud-Card-Present Environment	Other fraud with using the card	120
10.4	Fraud–Card Absent Environment	Fraud without card usage	120
10.5	Visa Fraud Monitoring program	Visa Program monitoring fraud	120
11.1	Card Recovery Bulletin	List of blocked kart	75
11.2	Declined Authorization	Rejected Authorization	75
11.3	No Authorization	No authorization	75
12.1	Late Presentation	Making a transaction with delay	120
12.2	Incorrect Transaction Code	Invalid transaction code	120
12.3	Incorrect Currency	Wrong currency	120
12.4	Incorrect Account Number	Wrong number accounts	120
12.5	Incorrect Amount	Wrong amount transactions	120
12.6	Duplicate Processing / Paid by Other Means	Reprocessing / Paid for by others way	120
12.7	invalid data	Inaccurate data	75
13.1	Merchandise / Services Not Received	The product / service was not received	120
13.2	Canceled Recurring transaction	Waiver of Periodic write-offs	120
13.3	Not as Described or Defective Merchandise/Services	Product / Service not match the description or damaged	120
13.4	Counterfeit Merchandise	Fake (counterfeit)	120
13.5	Misrepresentation	misleading	120
13.6	Credit Not Processed	Getting a loan without request	120
13.7	Canceled Merchandise / Services	Refusal of goods / services	120
13.8	Original Credit Transaction not accepted	Initial credit operation not accepted	120
13.9	Non-Receipt of Cash or Load Transaction Value	Non-receipt of payment or no download payment values	120

MasterCard - reason codes

Code	Meaning	Translation	Dispute period (days)
4802	Requested/Required Information Illegible or Missing	Information requested/required is unclear or missing	45
4807	Warning Bulletin File	File of invoices included in the stoplist	45
4808	Requested/Required Authorization Not Obtained	Requested/Required authorization not received	90
4812	Account Number Not On File	Account number not on file	45
4831	Transaction Amount Differences	Transaction amount differs	120
4834	Point-of-Interaction Error	Data processing error	120
4837	No Cardholder Authorization	Cardholder authorization missing	120
4840	Fraudulent Processing of Transactions	Fraudulent transaction processing	120
4841	Canceled Recurring Transaction	Canceled periodic transaction	120
4842	Late Presentation	Late grant	120
4846	Correct Transaction Currency Code Not Provided	Correct transaction currency code not provided	120
4847	Requested/Required Authorization Not Obtained and Fraudulent Transaction	The requested/required authorization was not received and the transaction is fake	120
4849	Questionable Merchant Activity	Questionable seller activity	120
4850	Installation Billing Dispute	Dispute over the payment of the next installment	120
4853	Cardholder Dispute-Defective Merchandise/Not as Described	Cardholder dispute - defective item / not as described	120
4855	Goods or services not provided	Goods or services not provided	120
4857	Card-Activated Telephone Transaction (fraud only)	Phone transaction activated with a card (only in case of fraud)	120
4859	Change to Addendum, No-show, or ATM Dispute	Change in supplementary agreement, no-show or ATM dispute	120
4860	Credit Not Processed	Loan not processed	120
4862	Counterfeit Transaction Magnetic Stripe POS Fraud	Fraud using counterfeit POS magstripe	120
4863	Cardholder Does Not Recognize - Potential Fraud	Non-recognition by the owner of the card - possible fraud	120
4870	Chip Liability Shift	The rule of transferring responsibility to the "non-chip" party (to the party that allowed the illegal operation)	120
4871	Chip/PIN Liability Shift	Responsibility transfer rule to the "non-chip"/PIN side	120

CODES OF MAIN REASONS FOR MIR payment system dispute

Code	Meaning
4501	The request for copies of documents was not executed / executed incorrectly
4508	Violation of authorization procedures
4580	Violation of transaction processing procedures
4555	Purchased goods not delivered / services not provided / work not performed
4590	Cash was not dispensed by the self-service device in whole or in part
4554	Purchased goods / works / services paid for in another way
4560	Credit transaction not processed
4537	Unauthorized operation

Disputes are an analogue of chargeback in the MIR payment system

The MIR (PSM) payment system, Dispute Plus, also has a kind of chargeback: in 2018, its operator, the National Payment Card System (NSPK), launched its dispute model to challenge payments by MIR cardholders. If you could not agree on a refund with the seller, you submit the dispute to the PSM operator for resolution, and he resolves your issue in accordance with the Rules of the MIR payment system. The conditions for protesting payments in the MIR system are somewhat different from the conditions in the Visa and MasterCard IPS (for example, the period for settling disputes is up to 30 days).

Scheme of conducting disputes in the payment system "MIR"

MIR itself acts as an arbiter of disputes as a payment system. The cardholder can open a dispute (in other words, initiate a chargeback) by submitting an application to the issuing bank within 180 days from the day the funds were debited from the card. In the case of a co-badged card - Mir-Maestro, Mir-JCB, Mir-UnionPay - disputes over transactions made on the territory of the Russian Federation will follow the NSPK dispute model and take up to 30 days. If a transaction on such a card takes place abroad, then the dispute on it will be settled within the framework of the classical model of the dispute cycle that is in force with the Ministry of Railways.

Some statistics: in the first month of "Dispute.Plus" operation (July 25 - August 25, 2018), about 1,000 disputes were processed by the system.

The most common problems for MIR cardholders:

• ATM did not dispense cash (39% of disputes);
• the goods were paid for but not received (33%);
• unsuccessful transaction (17%).

About half of the disputes (48%) were found to be justified (the money was reimbursed).

The most common well-founded disputes:

• violation of the operation technology (83% of disputes);
• order or subscription canceled (69%);
• ATM did not dispense cash (67%).

The average response time in Dispute Plus is currently 3-4 days, with the declared maximum dispute resolution period of 30 days.

Successful chargeback on the MIR card of one of our clients

Algorithm for carrying out the chargeback procedure

In most cases, chargeback is initiated for the following reasons:

• Merchant refuses to carry out a refund;
• the product/service does not match the description, is not presented in the proper quality/in full or is not presented at all (not delivered/not provided);
• the purchase price and the amount deducted from the card are different;
• there is a payment in the card statement that the client did not make;
• The signature on the card and on the invoice is different / the signature of the buyer is missing.

Attention: before initiating the process of protesting a payment, find out all the parameters of the disputed transaction: date, time, amount and place of the transfer. In addition, interrogate with prejudice everyone who has access to your card, whether they made a suspicious transaction. If your claim turns out to be unfounded, you may be fined (depending on the particular bank).

And again, an example from the general conditions for opening, maintaining and closing accounts for individuals of one Russian bank owned by Oleg Yuryevich:

The Bank has the right to charge a fine in the amount of 1,000 (one thousand) rubles for each disputed transaction if, during the consideration of the application, it is established that the Client is involved in this transaction or the transaction became possible due to the violation by the Client of these General Terms and Conditions and the procedure for using ... the card.

How the chargeback procedure works - a step-by-step algorithm using the VISA MPS as an example

In most cases, the chargeback process goes like this:

1. The client applies to the issuing bank with a free-form application, which indicates the essence of the claim, card number, date and amount of the transaction, as well as other information proving the validity of your application (checks, receipts, notifications, delivery tracking number, screenshots, correspondence with TSP as an attempt to resolve a dispute, contract, etc.).
2. The issuing bank considers the application and either refuses to protest the transaction, or sends a request to the acquiring bank to return the payment.
3. The acquiring bank considers the claim of the issuing bank and either makes a reverse payment or transfers the claim to the Merchant, which is the second party to the disputed transaction. If the acquiring bank does not respond to the request of the issuing bank, after 30-45 days the dispute will automatically close in favor of the buyer, the money will be returned to the card. If the acquiring bank initiates a representation (disputing the chargeback), the issuing bank sends a repeated chargeback to the acquiring bank (pre-arbitration for MasterCard or arbitration chargeback for Visa), after which the arbitration procedure begins (MPS conducts an investigation and makes a decision binding on banks) .
4. Upon receipt of a request for a refund, the Merchant must, within a certain period of time, provide evidence that the service paid by the cardholder has been provided in full. Otherwise, the amount is directly debited from the merchant's account and returned to the recipient, and all expenses (commission refund, chargeback penalty, etc.) are borne by the merchant.
5. If the merchant believes that it is right, it, in turn, has the right to challenge the chargeback through arbitration of the IPU and refuse to return the money. If the merchant has a “stigma in the gun”, it is easier and more profitable for him to return the money voluntarily: he will lose profits from the sale and commissions, but avoid a fine and maintain his reputation in the eyes of the Ministry of Railways, which is the most important thing.

The chargeback itself does not compromise the TSP– the reasons for a refund can be different, from a technical failure to a misunderstanding between the seller and the buyer. But the merchant is interested in reducing the number of chargebacks: if the number of protested transactions exceeds a certain percentage of the total number of transactions, the merchant may receive a fine from the acquiring bank or be disconnected from it altogether.

Why so strict? It's simple: acquiring banks that work with dubious merchants, to which chargebacks are regularly received, in turn, "receive a cap" from international payment systems. This encourages them (acquiring banks) to carefully select partners from among merchants, monitor their activities after connection, identify and stop fraudulent schemes and operations, and ban malicious repeat offenders.

Basic terms and concepts of chargeback

Terms and concepts that are mandatory for those who plan to protest a bank card payment.

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Basic concepts of the payment protest process:

• arbitration - consideration by the IPU of a dispute between the issuing bank and the acquiring bank with the issuance of a binding decision for the parties;
• bank card - a plastic card or virtual card linked to one or more current bank accounts and used to pay for goods and services, as well as withdraw cash;
• acquiring bank ("seller's bank") - a bank that accepted the buyer's bank card as a means of payment for the goods or services of the Merchant;
• issuing bank ("buyer's bank") - the bank that issued the bank card [of one of the IPS] through which the disputed payment was made;
• MPS - international payment system (VISA, MasterCard);
• buyer - a client of the issuing bank disputing the transaction;
• seller (recipient) — Merchant to whom the disputed transaction was made;
• representation - a counter operation to challenge the chargeback by the acquiring bank;
• refand (refund) - a voluntary return of funds from the merchant to the buyer who paid for the product or service;
• transaction - transfer of funds from one account to another;
• TSP - trade and service enterprise: store, brokerage company ...;
• chargeback - the procedure for contesting a payment, provided for by the IPS;
• pre-arbitration (MasterCard) or arbitration chargeback (Visa) - the last request for a chargeback from the issuing bank to the acquiring bank (for example, in the case of a representation), after which both banks have the right to call the MPS to act as an arbitrator in the dispute (the loser pays the MPS a fine) .

Speaking of repeat offenders: in recent years, payment systems have seen an increase in complaints from cardholders and appeals from financial regulators and law enforcement agencies regarding fraudulent or illegal business practices by various brokerage companies (Forex, CFD, binary options, cryptocurrencies). In this regard, in May 2018, the IPU MasterCard announced that from October 12, 2018 it allocates companies of the above profile to the Business Risk Assessment and Mitigation, BRAM category.

This means that from autumn 2018, payment processors processing High-Risk Trading Provider (BRAM) transactions will have to provide evidence to the MasterCard provider that all necessary precautions have been taken in the process, and BRAMs themselves will have to provide evidence of legal activity. Transactions of BRAM companies will be marked by credit card acceptors with the code 6211, the chargeback for which is possible within 540 days from the moment of the transaction.

International payment systems in one way or another restrict (and even prohibit, like MasterCard) the use of chargeback in relation to merchants offering gambling, investing, etc. services. In such cases, it is difficult to return the money, but it is possible by choosing the correct dispute reason code, for example, “failure to provide a service”, if your personal account is blocked by a broker. And if you convince the MPS that there was no brokerage as such (the broker did not bring transactions to the market, although the opposite was stated), the chances of returning the money will increase markedly.

3 Possible reasons for rejecting a chargeback

Recommended reading First of all, any issuing bank that works with IPS VISA and MasterCard (issuing their payment cards) has no right to refuse to accept your application for protesting the payment. Whether your case will be given a move is another question, but the bank must always accept the application. In general, banks are rarely eager to meet the client in such cases (for nothing that, according to the rules of the IPU, the bank must provide the cardholder with all possible assistance in challenging the transaction), get ready to face all sorts of obstacles, sometimes very serious.

One of them is the incompetence or laziness of a particular representative of the bank: you may not be understood or “not understood”. Tip: when referring to specialists, instead of the word “chargeback”, it is best to use the phrase “disputing a payment”. However, even in this case there is no guarantee that your application will be accepted on the first attempt. The reasons can be objective (incorrectly drawn up application, insufficient evidence base, etc.) and subjective (the bank is not interested in issuing a chargeback: its representatives will sabotage and convince you of the futility of the case, but you stand your ground).

What to do if the bank refuses to accept a chargeback application:

• try to resolve the issue with different employees up to the head of the department;
• contact another branch of the bank or even the head office;
• ask for a refusal in writing, if it is not given, send documents by mail with a list of attachments;
• if the bank’s response violates applicable law, internal banking rules and regulations, the regulations of the Ministry of Railways - contact the Central Bank, Visa, MasterCard and even the court as a consumer of banking services, especially if you missed the deadline for arbitration through the fault of the bank (by the way, if the court accepts your side, you can demand from the issuing bank that refused to accept your application the amount that it prevented from returning, as well as a penalty, a fine, moral damages and court costs - great, right?).

By the way, it will not be superfluous to figure out what is more profitable for you - to try to initiate a chargeback or to beat your money out of the merchant through the courts. Sometimes litigation is much better.

For reference: the activities of payment systems, and indirectly - chargeback, on the territory of the Russian Federation are regulated by federal law No. 161-FZ "On the national payment system" and federal law No. 2300-1 "On consumer protection".

HOW BANKS ARE APPLICATIONS FOR CHARGEBACK - our STATISTICS

LOYAL	NOT VERY LOYAL	NOT LOYAL
PJSC "Sberbank of Russia"	PJSC Promsvyazbank	JSC "Tinkoff Bank"
PJSC "Bank VTB"	Bank CenterCredit JSC	Euroset-Retail LLC
PJSC "Asia-Pacific Bank"	PJSC "Bank URALSIB"	OJSC "BCS - Investment Bank"
JSC "Raiffeisenbank"	JSC "All-Russian Bank for Regional Development"	JSC "Alfa-Bank"
PJSC KB "Vostochny"	JSC Halyk Bank of Kazakhstan	PJSC "Post Bank"
PJSC JSCB "Avangard"	PJSC "Moscow Credit Bank"	JSC "Rosselkhozbank"
JSC "Kazkommertsbank"	PJSC Bank "FC Otkritie"	PJSC "Svyaz-Bank"

If the bank accepted the application (be sure to take its registered copy with a number by which you can track the current status of your case), but did not respond to it within the established time limits (the bank has 30-60 days during which it must give either a positive, or no), apply again. If the reaction of the bank did not follow this time either, or it was inadequate (a banal reply or refusal on grounds contrary to the relevant standards), write a complaint to the management.

Refusal to conduct a chargeback may be justified both from the point of view of the bank and according to the rules of the Ministry of Railways. This can happen if you missed all the deadlines for issuing a chargeback or failed to provide convincing evidence to protest the payment. In the first case, you can say goodbye to your money forever. If the matter is in an insufficient evidence base, collect new data and write a statement again.

Visa, MasterCard are payment systems with international status. The bank that issued the Visa or MasterCard card automatically accepts the International Payment System Rules. This means that in the event of a disputable transaction, the issuing bank is obliged to consider the cardholder's application for a chargeback according to international rules and, if the transaction is recognized as disputable, submit the request to the Ministry of Railways.

If the payment is protested by an individual, the risk of refusal becomes higher due to the person's ignorance of the intricacies of the procedure. To resolve the issue with a greater likelihood of success, we recommend that you seek legal advice. When a legal company handles the chargeback procedure on behalf of the client, the bank is more willing to work in accordance with the regulations. The choice is yours - to contact the bureaucratic machine of banks on your own or delegate this task to specialists.

1. Is it possible to dispute a payment to an individual made by an interbank transfer?

No, chargeback is possible only when paying for goods and services of a merchant that has entered into an appropriate agreement with an acquiring bank in order to accept payments for its goods and services through MPS using a card or its details.

2. Is chargeback possible with any card?

Yes, it can be any card - debit or credit, plastic or virtual. The main thing is that it belongs to the MPS Visa, MasterCard, Maestro (or the MIR payment system, payments within which can be disputed through the so-called disputes).

3. Is it possible to dispute a payment if it was made through electronic wallets such as WebMoney, QIWI, etc.?

Unfortunately no. But these EPS have their own methods of protecting the buyer and resolving disputes with sellers. For example, in Yandex.Money, this works as follows: transactions with Poison cards are subject to the chargeback rules through MasterCard, but if you paid for the order from the Yandex.Money wallet (from the balance of the wallet or from the linked card), “Buyer protection” is turned on. To dispute the payment, you can contact the YOD within 90 days from the date of payment, and if the EPS is on your side, the money will be returned to your card within 30 days. True, the Purchase Protection in Yandex.Money applies only to orders for physical goods (those that can be “touched”) and does not apply to online stores with their own arbitration system (AliExpress, eBay, etc.).

4. Is it true that a MasterCard chargeback is impossible if the money was lost in investments or trading?

Yes, that's right: recently, MPS MasterCard in most cases refuses chargeback to people who have lost money in the field of investments, gambling, etc.

5. And why, in this case, some legal entities promise a refund of funds spent through EPS such as Qiwi, WebMoney or MasterCard? Are they misleading?

Yes, the promise to return the money deposited in investment companies through the specified payment systems through a chargeback is at least a slyness.

Another issue is that individual companies offering assistance in protesting a payment may use other mechanisms, often dubious - blackmailing a broker, for example, or threats.

6. Is a chargeback possible if the broker leaked my deposit?

Depends what you mean by "broker leaked my deposit". If you voluntarily handed over the password from your account/terminal to a broker representative, most likely you won’t be able to return the money - you will only lose time.

If your deposit was leaked due to the broker providing a non-market quote, your chances of getting your money back are quite high.

7. Is a chargeback possible if I lost my deposit myself?

No, a refund in this case is extremely unlikely. You will need to prove that the service was provided improperly or incompletely. It is very difficult.

8. How is a payment disputed if the recipient resets his accounts with the acquiring bank and disappears? Who will pay?

In general, the claim is addressed to the acquiring bank. As a last resort, MPS pays.

9. The issuing bank, to which I applied for a chargeback, is delayed in responding, violating the deadlines specified in the regulations. What to do?

It is necessary to send a written request to the bank, in which it is required to provide you with information in writing on the results of consideration of your application. If the bank continues to ignore your appeals, you can file a complaint with the Bank of Russia or the Ministry of Railways, and also contact a lawyer to draw up a statement of claim in court.

10. I am not a resident of Russia, is it possible to initiate the chargeback procedure on my part?

Yes, because chargeback is a procedure provided by international payment systems.

11. Is it possible to initiate a chargeback in a foreign bank?

Of course, but there may be some specifics in the rules for filing an application (the protest procedure itself is regulated by a single document of the Ministry of Railways).

12. Is chargeback possible from offshore brokers?

Yes, the rules of the IPU apply to them as well.

13. In what language is an application for a chargeback made?

If the issuing bank is Russian, we submit the application in Russian, but for Pre-Arbitration or Arbitration it will be necessary to translate everything into English - these are the rules of the IPU.

14. I lost my money on Forex, in HYIPs, pyramid schemes, online casinos, betting shops… Is a chargeback possible in these cases?

Perhaps, but not always. It all depends on the specific situation.

15. Can I get a refund of money spent on tickets purchased from bankrupt airlines, but through an intermediary?

Most likely you can. The TSP in this case is an intermediary (the ticket office where the tickets were purchased), and not the airline.

16. Where does the money go if the chargeback is successfully completed?

The money will be returned to the account linked to your card. If the card is in rubles, then the amount will be returned in rubles (even if the payment was in foreign currency) at the rate that was in effect at the time of payment.

17. Where to apply for a chargeback? Bank or MPS?

The application is submitted to the bank, and the latter already initiates a protest against the payment.

18. The bank refused the chargeback. What to do?

It all depends on which bank refused you - the issuer or the acquirer. If the issuer, it is necessary to find out what the bank motivated the refusal and act according to the circumstances. If the acquirer - similarly, but with access to the arbitration of the MPS.

19. From what moment is the chargeback period counted?

Depends on the situation:

• or from the moment of payment;
• or from the moment the consumer was informed that the product or service would not be provided;
• or from the last date when the cardholder could have expected delivery of the goods or provision of the service.

20. How long can the procedure for protesting a payment (chargeback) take?

On average, the chargeback lasts 92 days - these are the statistics of our cases.

21. Can I be fined if the chargeback is deemed unreasonable?

Yes, some banks (but not IPS) can do this. In addition, your account/card may be blocked on the merchant's or broker's website.

22. Is it possible to chargeback for operations through online banking or mobile banking?

No, if the payment system (MPS) is not involved.

23. I paid for the goods in the Internet bank by transferring funds according to the application to the seller's settlement account (the purpose of the payment is payment against the invoice for the goods). Is a chargeback possible in this case?

Contact the bank with a request to clarify whether the IPS was involved in the transaction. If yes, the money can be returned. If the payment was transferred to a private person's card, and not to the company's current account, then there would be no grounds for a chargeback.

24. Is there such a thing as a minimum amount to dispute a payment?

Yes, the IPU sets a minimum chargeback amount depending on the basis. Most often it is $25.

25. Is there an instruction for chargeback in Visa and MasterCard in Russian?

There is no detailed guide on protesting payments in Russian (there is a chargeback guide from Visa and a chargeback guide from MasterCard in English).

4 Chargeback - how to return money from a broker ... or not to return

By the nature of my work (I am an introducing broker, i.e. an IB partner of several major retail Forex companies), I often have to communicate with various representatives of companies from the financial industry, including guys from partner departments of forex brokers. With them, we discuss new strategies for promoting certain services: I report to them on the work done, they devote me to marketing plans and innovations, offer to test new sales schemes. And sometimes we tell each other "about what is hidden" ...

Related Article Do you know what broker companies are most afraid of? Smart clients: cheaters, toxic traders, etc. Guys. Also, brokers are afraid of chargebacks: with a competent approach, in some situations, a client who drained a deposit with his own hands may well return it by stupidly submitting an application to the issuing bank to protest the payment to the Forex company (provided that the payment was made using a card of one from MPS). Even despite the fact that payment systems have recently severely limited and prohibited chargeback in cases related to investment, each claim from the acquiring bank makes him - the broker - suffer. He understands that the rules of the Ministry of Railways will get him on any islands and offshores, unlike the police or bandits, prosecutors, bailiffs and even financial regulators, which often do not exist at all, or they are fictitious.

The broker's main nightmare is the massive use of the payment protest mechanism: if every client draining a deposit knows about the possibility of using a chargeback, the brokerage business may suddenly end (in the end, the acquiring bank will break off all relations with such a broker, and it will be disconnected from the IPU). Yes, earlier, just a few years ago, the legal literacy of the population left much to be desired, but look at what is happening on the Internet today: “We will return the money on a chargeback from forex, binary options!”, “Paid for forex with a card? Has not passed 540 days? Money can be returned!”, “We will return the lost investments! Legal advice on chargeback!”…

Yes, among those who offer the service of assistance in obtaining a chargeback, there are enough scammers and just hacks: these guarantee a 100% positive result, brag about connections in banks and payment systems, immediately demand an unacceptably large prepayment, having no reputation, and the legal support of the client is reduced only to a one-time application to the bank, if after the prepayment these “lawyers” get in touch at all (by the way, this does not mean that there are no decent people on the Internet). But among those who offer brokerage services - this applies to both American and European financial brands, as well as offshore nonames - there are no less scammers:

• they announce the withdrawal of transactions to the interbank market, while they themselves, at best, execute everything within the company, and often do not participate in the market at all;
• give and inadequate delays in execution;
• ignore applications for withdrawal of funds (both profits and the body of the deposit), reset the account and disappear;
• promise "reinforced concrete returns" and "almost zero" risks;
• gain confidence in customers, blackmail them over the phone and drain their deposit.

Similarly, not all brokerage companies are scammers, there are those who work cleanly, but if an unscrupulous client comes up with the idea to return the “lost” money, he may well be able to rob even the most clean company.

Chargeback from broker. Client actions

Before initiating a chargeback from a broker related to trading / non-trading operations, carefully study all the regulatory documents and answers from the broker's support service, remember the timeframe during which a chargeback is possible (if at all). If the broker is sure that he is right, he will dispute your chargeback (see below). representative), but this will take time and expensive resources - legal support, participation in court hearings, etc. And the company will not forgive you for this: when you applied for a chargeback from a broker, you accused him of fraud.

How to return money from a forex broker through a chargeback:

• prove that the terms of the contract / offer have been violated (for this you need to carefully read the documents that you sign);
• prove that there was a technical/technological failure;
• to prove that the personnel of the company or its specific specialist behaved incorrectly (deceived, blackmailed, threatened, guaranteed);
• correctly select the chargeback code;
• apply for legal assistance to (dishonest ones can be bought: employees of companies contacted us a couple of times and asked not to initiate a chargeback in their address, they offered banknotes in return);
• be lucky (sometimes a broker is so unprotected, and his arguments are so unconvincing for the MPS and the acquiring bank, that any housewife can “bend” him - a broker).

So, are you confident in your abilities? Are you not afraid that you yourself, in turn, will be convicted of fraud and at least close your access to the market by placing your data on a black list that brokerage companies have access to? I'm not even talking about the prosecution by the TSP. In addition, you will have claims from the bank and payment systems. And only if you are really scammed, initiate a protest boldly: if you correctly compose a motivation and select a code (reason code), not a single bank will dare to refuse to launch a chargeback from a broker.

Chargeback through the eyes of a broker. Five Minute Objectivity

Related Article In conclusion, let us clarify our position. First, we are convinced: abuse the chargeback mechanism in the financial markets - extramoveton, this can play a bad joke on all members of the forex community - remember MasterCard and its ban on protesting payments to investment companies. Market participants are losing trust in each other, and if there is no trust and long-term cooperation, there is no market. As for brokers: in fact, protecting yourself from unfounded claims from the IPU and the acquiring bank is simple.

How can a broker protect itself from chargeback - advice from those who do this every day:

• ensure maximum protection for payments and customer transfers (is your site still running on an insecure protocol? then we are coming to you!);
• provide the client with as much information as possible, including information about the risks (your clients do not risk anything? We are already going to trade with you for the entire depot);
• use the maximum number of actions in order to have clear evidence of the client’s actions in case of litigation (what, customers are too lazy to check the box? and who said it would be easy!);
• identify and verify your clients as meticulously as possible (are you a Russian forex dealer? sorry, in the house of a hanged man on a rope);
• do not contact the client without a serious reason (yes, leave your vile habit of calling clients and offering to trade with an experienced manager);
• opt for processing agents and methods of depositing funds that exclude, in your opinion, unreasonable protest of payment (in fact, I would not work with such a company, unless it is a Russian dealer);
• the most important thing: follow the formalities, keep an eye on the equipment and software, work with claims correctly, pay attention to the personnel issue (we won’t talk about courtesy towards customers, it’s not up to fat);
• if you don’t care about your brand, you can reset customer accounts, liquidate the legal entity and hide, leaving your debts on the chargeback acquiring bank or MPS if the acquirer is washed away with you (well, you are not like that).

Secondly, we, for our part, will do everything to protect our clients from arbitrariness. No matter how individual brokers flaunt, we know that more and more clients refuse to replenish their account through EPS in favor of MPS payment cards, meaning to protect their interests possible conflicts in the future. Yes, MasterCard refuses to charge back "investors". Yes, most likely, Visa will follow. But you - brokers - must understand: this is not a reason to deceive people. Remember, in addition to the rules of the Ministry of Railways, there is the Bank of Russia and the RKN, there is a court, there is God in the end.

And one more thing: recently, publications have appeared on financial Internet resources, often controlled by forex companies, the purpose of which, apparently, is to compromise both the very mechanism for protesting a payment (chargeback), and organizations offering assistance in issuing a chargeback (they say , scammers, etc.).

Fraudsters in any field is not a debatable issue, there is nothing to discuss here, everything is clear with this. One thing is not clear: why these resources pay such close attention to the issues of protesting payments (justified or not), while often ignoring the topic of fraud in financial markets, incl. among brokers. Is money slipping away?

5 Our Chargeback Affiliate Program

We offer everyone who wants to earn on our affiliate program:

1. You leave a request on chargeback@website (you can also leave a request through the contact page)
2. We give you a referral link to attract customers.
3. You bring a customer to us who wants to dispute a payment and get a refund.
4. We assign a client to your affiliate group and give you access to the partner's personal account, which displays all the statistics: the number of attracted clients, the stages of each case promotion, the amount of your rewards.
5. The client returns his money with our help and pays for our work, and we, in turn, pay you a partner commission.

Working with us is profitable and expedient: people like us are usually called eco-friendly affiliate programs - we make the Internet cleaner, we bring benefits to people, and there will always be a demand for this, especially in our time, when they can deceive at every step, no matter online store or in a shopping center, travel agency or fitness club.

If you have any questions about cooperation within the framework of the affiliate program, you can leave them in the comments or send them to our mail chargeback@website