Input please: Charge-back Fees...?

[KasinoKing]

Charge-backers are scum and the bane of our industry - I'm sure we all agree on that.
And we also understand when casinos remove the commission earned from deposits which were later charged-back.

But I am working with "An Operator" who is also passing on (deducting from my commission) a "Charge-back Fee" which they have to pay their processor every time this happens.

Every time (for the last year or so) it has been $150 per transaction.

With two of the "players" concerned they charged-back 8 times for amounts averaging $26 a time... so for $208 worth of charged-back deposits, I had to "pay" $1,200!
There were a few other players too - so my bill for the last year was $3,300 in fees.
This left me with very little commission and a bad taste in the mouth...

Anyone else seeing this anywhere?
What do you think about it, and the amount of the fee?

Cheers,
KK

 

[Engineer]

I haven't experienced this yet, but it sounds very unfair.

Why is the fee so high? And why are you on the hook for the entire $150 fee? That shouldn't be the case.

Something smells rotten here....

I would name and shame, but that's just me.

 

[bonustreak]

That sounds absurd!!

 

[PROFRBcom]

Even if the operator passed on the chargeback to you, it should be prorated according to your commission percentage. So for example, if you're on a 50% rev share deal, I think at most you should be liable for $75, the half you stood to earn. Now, with that said, I think it's the operator who needs to absorb that cost. If your clients showed a history of chargebacks over time, above average for the industry, then I could see penalizing you for sending high amounts of fraud traffic, but by default, it's pretty absurd to pass along such charges.

 

[slotplayer]

Does seem high but I'm not surprised. I do recall being charged $100 a few years back.
Most of these so called "partnerships" are a % of "net profits" which to me means after all overhead expenses are deducted vs. an "equity partnership" which would share the overhead costs as well as company profits.

 

[Shay]

Charge-backers are scum and the bane of our industry - I'm sure we all agree on that.
And we also understand when casinos remove the commission earned from deposits which were later charged-back.

But I am working with "An Operator" who is also passing on (deducting from my commission) a "Charge-back Fee" which they have to pay their processor every time this happens.

Every time (for the last year or so) it has been $150 per transaction.

With two of the "players" concerned they charged-back 8 times for amounts averaging $26 a time... so for $208 worth of charged-back deposits, I had to "pay" $1,200!
There were a few other players too - so my bill for the last year was $3,300 in fees.
This left me with very little commission and a bad taste in the mouth...

Anyone else seeing this anywhere?
What do you think about it, and the amount of the fee?

Cheers,
KK

I think that I would need to see the affiliate terms and conditions for the program regarding charge backs before I can comment on how fair this is or is not.

 

[Kristine]

At our casino I believe the charge is around $50 usd per transactions with a chargeback. Then to challenge the chargeback its another $50 usd per transaction. Should be prorated.

 

[Kristine]

Charge-backers are scum and the bane of our industry - I'm sure we all agree on that.
KK

True that, we had a guy just do a chargeback and per his linkedin profile is a security manager at IGT. Luckily it was small <$1k. Its the $20 per deposit customers that are the worst when it comes to chargebacks.

 

[Guard Dog]

What I do not understand is why a single player would be able to charge-back multiple times. Isn't this considered fraudulent? You say 2 players charged back a total of 8 times - I don't get why they are still players at the casino in question. That - to me is more odd than anything.

However - I do agree, charge-backs should be pro-rated - not fully passed to the affiliate. They aren't taking it directly off of commission are they? Wouldn't it be part of the Net Revenue calculation?

 

[AussieDave]

Charge-backers are scum and the bane of our industry

Generally I'll agree. But, there are times when a casino wont refund, lets say, double dipping.

EG - Player makes a single deposit, but CC is hit twice for the same charge within seconds of each other. The casino refuses to take accountability, and refuses to credit the additional funds. Should a player just go, 'oh well, the casino can keep that money!'. That's just once scenario, in a long list of many, I'm sure.

More to the point, lets say you purchased a product online but never received the product. Would you simple wear that charge

IMHO chargebacks are a pain in the ass, if/when a player has no intention to pay in the 1'st place.
However, I don't think every CB warrants ALL people being labelled as scum.

With regards to the CB processor charges, AFAIK every single charge back incurs a seperate CB fee(s). In addition to the originating CB amount. $150 per item seems about right. However, those fees and CB amounts should be pro rata on your affiliate commission %. Not just added as a 100% debit value to your aff account.

One observation though, taken from ALL the casinos I promote, have promoted, (touch wood) I've not got a CB in years.

How is it your getting hammered by numerous CB's in a year...

Which casino is this for? Is it a Rival Cause this sounds really suspect to me...

 

[AussieDave]

had a guy just do a chargeback and per his linkedin profile is a security manager at IGT.

I'm sure someone at your program/company has a paid Linkedin account. Did anyone contact this guy, asking wtf?

 

[KasinoKing]

What I do not understand is why a single player would be able to charge-back multiple times. Isn't this considered fraudulent? You say 2 players charged back a total of 8 times - I don't get why they are still players at the casino in question. That - to me is more odd than anything.

Each of the 2 players did 4 charge-backs at once.
i.e. Player A did 4 CB's on April 6th, 2016
Player B did 3 CB's on April 13th and 1 on April 14th, 2016
Another player "C" did 2 CB's on April 20th, 2016

Very suspicious as each lot of CB's was roughly 1 week apart...

Which casino is this for? Is it a Rival Cause this sounds really suspect to me...

Could be...

Actually it's an operator with both Rival & RTG - and I have the same charge-back issue on both

For clarity & fairness, they were going to deduct $450 from my June earnings to pay for 3 CB's at the RTG casino - even though the CB's were more than a year ago! But after discussion they agreed to waive the charges on this occasion.

KK

 

[LinuZ]

Is it the casino that take the fee from your or a third party of theirs?

 

[BetReels]

The real problem here is the credit companies processing USA transactions. They pretty much do what they want and 90% of the time, they run off with the proceeds.

A chargeback on a normal credit card transaction does not usually incur any fee for the merchant, but when it comes to gaming, the guys doing the miscoding feel it's ok to charge as much as possible. The casino then carries these costs and all the risks. Nowadays, US processors charge the following:

1. 7.5%+ per deposit as well as a $2.50 per transaction fee
2. 10% in reserves
3. $2.50 per rejected deposit
4. $150 per chargeback
5. $100 per refund
6. $5000 set-up fee
7. $300 statement fee (to generate a merchant statement)
8. $150 wire fee (to send the merchant their money)

In a normal environment, the fees look like this:

1. 1 to 2,5% per deposit
2. 5% in reserves
3. 0 for rejections
4. 1% to 2.5% for Chargebacks
5. $0 to refund
6. $0 to set up
7. $0 statement fee
8. $20 wire fee

It is almost impossible to find an honest and reliable US Card processor. Most are Asian based with a couple of really bad ones in Tel Aviv. They wait until they are holding a few hundred thousand and then generate exorbitant fines of $75,000 to $250,000 claiming it to be from Visa and MasterCard. They then close the merchant account/s and disappear. 3 or 4 days later, the casino is bombarded with emails from "new processing companies" looking for business. It's the same folks using different companies to keep the wheels going round and round.

Looks like crypto-currencies is the way to go to get away from the chargeback issues.

 

[KasinoKing]

It is almost impossible to find an honest and reliable US Card processor. Most are Asian based with a couple of really bad ones in Tel Aviv. They wait until they are holding a few hundred thousand and then generate exorbitant fines of $75,000 to $250,000 claiming it to be from Visa and MasterCard. They then close the merchant account/s and disappear. 3 or 4 days later, the casino is bombarded with emails from "new processing companies" looking for business. It's the same folks using different companies to keep the wheels going round and round.

Your whole post is completely spot on and probably something many affiliates don't realise is going on.

The same company I am referring to told me they had a $50,000 "fine" from a processor because the transactions were for gambling...
They partly used that as an "excuse" to justify keeping $xx,xxx they "stole" from me by changing my affy deal without telling me.

But on the flip side:
With USA facing operators, if you are on 35% you'll likely end up averaging 25% to 30% of deposits as commission.
With regulated markets (like UK & EU) it's much more likely to be only 5% to 10% of deposits...

KK

 

[slotplayer]

What I do not understand is why a single player would be able to charge-back multiple times. Isn't this considered fraudulent? You say 2 players charged back a total of 8 times - I don't get why they are still players at the casino in question. That - to me is more odd than anything.

However - I do agree, charge-backs should be pro-rated - not fully passed to the affiliate. They aren't taking it directly off of commission are they? Wouldn't it be part of the Net Revenue calculation?

Most likely the player is making additional deposits while the first set of cb's are in the pipeline..

Keep in mind that it depends when the cb comes in. It can be weeks later and the affiliate has been already paid a commission on the deposits that were lost and subsequently charged back, which would mean the affiliate technically owes the program that money.

 

[slotplayer]

Your whole post is completely spot on and probably something many affiliates don't realise is going on.

The same company I am referring to told me they had a $50,000 "fine" from a processor because the transactions were for gambling...
They partly used that as an "excuse" to justify keeping $xx,xxx they "stole" from me by changing my affy deal without telling me.

But on the flip side:
With USA facing operators, if you are on 35% you'll likely end up averaging 25% to 30% of deposits as commission.
With regulated markets (like UK & EU) it's much more likely to be only 5% to 10% of deposits...

KK

I was aware of it. Higher charge back rate for gambling compared to other industries.

 

[Kristine]

I'm sure someone at your program/company has a paid Linkedin account. Did anyone contact this guy, asking wtf?

He was contacted and responded via phone after we mentioned his employer. If it was up to me I would contact his employer, reason is that he is taking privileged information and using it to defraud online casinos. But we will see what happens.

 

[Jack Lee]

Seem odd you can do charge-back now days when most cards are with 3D-secure? Maybe its just another way to make money for the casinos.

 

[slotplayer]

Does seem high but I'm not surprised. I do recall being charged $100 a few years back.

I did have more recent charge backs, one totaling $610 in March and another for $65 in June, both at Deck.