Bank Online Casino Chargeback
The credit card company clears the funds to the online casino and the player starts wagering. When the player receives the statement from the credit card company he denies having sanctioned the payment and demands a charge back. This forces the credit card company and the online casino to carry out an investigation. The Consequences of Chargebacks to Online Casinos & Poker Rooms Here's why I recommend this only for problem gamblers - like me! When a chargeback takes place against a casino's account, and that casino is forced to cover the player's losses, the casino adds that player to a universal blacklist.
What Is An Online Casino Chargeback?
A chargeback is a general term, which means the return of the funds to a customer. Basically, after making a payment, you can take it back by claiming that the service provider “tricked” you. For example, if the goods you received are faulty, you can claim a chargeback and get your money back. The payment provider (for example, the bank) refunds the money and resolves the problem with the service provider.
It is basically a consumer protection mechanism recognized by law, and its effectiveness will be determined by the scope of these laws. For example, it is most effective in the United States as a chargeback is almost a daily process made by every consumer. In European casinos such as Online Casino Norway, Online Casino Germany, and Online Casino Sweden, it is still effective but not like in the US: The consumer is literally the king in the United States and the whole country has a “no questions asked” policy. In third world countries such as Turkey, Saudi Arabia, and Egypt, it has almost no effect. In fact, some of these countries and their respective international online casino do not even have a chargeback system.
Now, since online casinos offer a service, the explanations above apply to them too. In other words, it is possible to make a chargeback claim for online casino payments like debit card, to learn more about payment methods come check out our payment casino guide. This is within your rights and chargeback online casino claims can be directed to every casino site out there, as long as your country gives you this right by law. After making a deposit and playing casino games, for example, you can issue a chargeback claim and get your money back. Sounds pretty good, right?
Well, not really. Making a successful online casino chargeback is a very challenging job and it has many consequences. Let’s explain this issue further.
How To Make A Successful Online Casino Chargeback
Disputing credit card charges online gambling may sound like a good idea, but you need to know lots of things to make a successful gambling chargeback. The first thing to know is that this system is being offered to protect the consumer. The main idea here is that if the service/goods you got are faulty, you don’t need to pay – the payment provider will refund your losses. “Faulty” is the key word here, because, in order to make a successful chargeback online casino, you must prove that the service is, indeed, faulty.
So, how to do successful 2021 online casino chargebacks? The “service” you are getting at online casinos is actually the chance to play casino games. That’s all. No online casino guarantees that you will win a prize. Their promise to you is to offer the chance to play games – even their numbers and providers are not guaranteed things. In other words, as long as you are able to play games in an online casino, the “service” you are getting will be exactly what is promised – there is no faulty service here.
So, the online casino will simply dispute your claim and state that they are able to offer the service as promised. And they will be right – other than offering casino games to play with real money, they are not promising anything. This explanation also shows how to make a successful online casino chargeback: If you can prove that the service is not as promised, your chargeback request will be accepted.
But, how can you prove something like that? Well, if you are playing in an unlicensed casino site and/or the RTP rates of the games are rigged, you can prove such a claim. If the online casino operator offers you games that you have no chance of winning, this is indeed a faulty service and online casino chargeback request will be accepted. However, proving such things is not an easy task: While it will be easy to show that an online casino has no license, you won’t be able to prove rigged RTP rates unless you have access to internal records. In short, this is a very hard thing to do and that’s why we don’t see many successful online casino chargebacks. However, even if you manage to do one, there will still be consequences: Keep reading to learn what these are and find more about some new payment methods like Ripple Casino sites.
What are the Consequences of Filing a False Chargeback?
When one makes a purchase using a credit or debit card, that person enjoys certain consumer protections offered by card networks like Visa and Mastercard, along with the bank that issued the card. One of the primary protection mechanisms is the chargeback.
A chargeback is a kind of forced bank reversal. The process was first introduced in the 1970s, as mandated by US law. For many years, the process worked just fine; the system was not prepared for the introduction of eCommerce, though, and that’s created problems.
Now, more and more consumers file chargebacks without a valid reason to do so. This has immediate consequences for businesses, but can negatively impact the cardholder, too.
The “Litigation-Based” Process
When one files a chargeback on a transaction, the person is essentially making a claim that the purchase is invalid for one reason or another. Some legitimate reasons to do this include:
- The purchase was fraudulent
- The goods or services weren’t as described
- The goods or services never arrived
- The seller charged the incorrect amount for the purchase
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If the cardholder has a legitimate reason to dispute a charge, it’s that person’s responsibility to first contact the merchant, and try to resolve the situation through the proper customer service channels. If unable to resolve the matter, the cardholder may then elevate things by contacting the bank.
The chargeback process is sometimes described as “litigation-based.” It essentially works like a court case; the cardholder (the plaintiff) makes a claim against the merchant. The merchant (the defendant) must then provide evidence to try and validate the original sale. The bank serves as a judge, evaluating each party’s case, and resolving the dispute.
The Problem with the Chargeback Process
The chargeback process is time consuming. It sometimes takes weeks, or even months, to resolve a dispute based on the situation. That aside, the process can work more or less as it was intended. The realities of the eCommerce market, though, complicate things.
An issuing bank represents their cardholders, while also serving as an impartial mediator during a dispute. The bank has an incentive to keep cardholders happy, so it’s as if the judge and the prosecutor in a trial are the same person. The merchant is, in effect, “guilty until proven innocent.”
Distance, and a less-personal relationship between buyers and sellers, is a natural part of eCommerce when compared to brick-and-mortar. As a result, customers can be incentivized to file chargebacks without as much consideration and due diligence. The bank, for their part, mostly accepts these disputes to try and appease customers.
Consequences for Chargeback Abuse
“Friendly fraud” describes a situation in which a cardholder files a chargeback without a valid reason. It may be an honest mistake, or it could be deliberate abuse. In either case, there could be consequences for the cardholder if abuse is identified.
- Loss of Funds: The bank will uphold the original transaction, allowing the seller to keep the funds from the sale. Even if the cardholder might have been able to request a merchant refund beforehand, that option is no longer available.
- Blacklisting: The merchant may blacklist the cardholder, leaving them unable to make any additional purchases.
- Loss of Banking Support: If abuse is serious enough, the bank may judge the cardholder to be too much of a liability, and close the customer’s account.
- Damage to Credit Score: Credit reporting agencies will take note if a cardholder loses banking privileges, especially if it increases the person’s credit utilization ratio. This will hurt the person’s credit score, making it harder to open future lines of credit.
Dispute Online Casino Charges
Of course, there’s also the simple matter of merchant costs to consider. When chargebacks hit merchants, it increases their costs, shrinking their profit margin. If the problem becomes a sustained issue, the seller could be forced to raise prices, impacting consumers as a whole.
Chargebacks are an important consumer protection tool. They must be handled carefully, though. If abused, chargebacks can become a costly problem for businesses and merchants alike.
Last Update: February 21, 2020
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