What's New: Discover Helps Steal Money for Merchant Technical Solutions
While this article is a digression from our "IT" format, we feel any business with a Discover merchant account for processing customer credit cards should review their bills immediately.
Update 3/11/10: We have heard reports that another company, Business Technical Solutions, is doing a similar thing with Discover. The name sounds suspiciously similar?
Update 10/7/08: To follow up, Discover did provide the remaining $49.95 credit omitted from the credit in September.
Update 8/21/08: Discover's Customer Service Liason (888-347-3204) has told us Discover will be crediting our merchant account after all. Persistence pays off!
The Scam
ITS recently discovered that Discover had been adding $49.95 in fraudulent hidden charges to our monthly bills. The bills are itemized essentially like this:
| Transaction | Fee |
|---|---|
| (some transaction) | $2.75 |
| (some transaction) | $1.50 |
| Total | $54.20 |
With just a few transactions the extra charge is easy to spot. A larger retail outfit with dozens or hundreds of charges per month probably won't even take the time to add up the fees, and will therefore lose $600 annually to this scam!
Online searches reveal this scam has been going on for at least a year or two.
Merchant Technical Solutions
Discover is facilitating this theft for an outfit called Merchant Technical Solutions, one of (apparently) many partners of theirs that can bill through a merchant account (as opposed to a credit card). Merchant Technical Solutions finally played a recording for us where we quite clearly said they could mail out information to us. Merchant Technical Solutions's policy is to therefore (because they mailed out information) sign up the merchant for a free trial, and start billing 30 days later, with no further communication. Merchant Technical Solutions refuses to refund all of the money stolen, saying their policy is to return a maximum of two months' fees.
Discover Network
Discover, to date, refuses to help and will not work with us to get the money back, even though they set up the billing for it without our consent. Instead they will only direct us towards Merchant Technical Solutions. Discover claims to only provide our company name and telephone number to "marketing partners," but the billing was set up through our Discover merchant account and Merchant Technical Solutions could only have gotten that information from Discover since we did not provide it which is completely contrary to the privacy agreement we had with Discover.
Remedy
If you are a victim of this scam please consider filing a complaint with your attorney general. If enough businesses have been scammed the amount stolen could be staggering. 10,000 "customers" means a half million dollars every month.
A business can (if they want to keep accepting Discover cards) ask Discover to mark your merchant account with a "no solicitation" notice, though that doesn't sound very promising to us.
Tuesday, Oct 7, 2008 03:45 pm CDT
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