What to do about merchant sending bogus charges to debt collection?
February 28, 2013 6:51 AM Subscribe
A local business charged my credit card about $18 eight different times over the last three months without authorization, interspersed with another eight or so legitimate charges. After a month of back and forth over e-mail, they refused to explain, refund or reverse the charges, so I initiated a charge back. They got really angry, and now say they want all the money plus $25 per chargeback or they'll send the debt to collections and make reports to all the credit reporting agencies. What to do?
posted by skewed to Law & Government (15 answers total)
This was for laundry service, which was scheduled for pick-up and drop off every other week. I was happy with the service for several months. Over the holidays, I sent an e-mail that I wouldn't need service for one of my normal pick-up weeks, but that I would resume service at my next normal week. They acknowledged my request and said it'd be no problem. A week or two later, I noticed a charge for about $18 on the account for that week, which annoyed me, so I went ahead and checked my bill more thoroughly, and noticed that I had actually been charged several times for the "off" weeks, always for the same amount, which is less than the $25-30 they usually charge for my typical laundry load. I e-mailed them a polite request to check their records because I assumed it was some kind of automated billing error, but they brushed me off. I e-mailed several more times with extreme specificity about the dates of the charges, amounts, etc. The only response I could get from them was "we have not and would not make any unauthorized charges to your account". They refused to specify the dates that they did or did not charge, and would not address my point about only getting service every other week but getting charged every week. There was actually a three week period where I was charged four times, so I have no idea why that doesn't seem obviously wrong to them. I suspect that they don't keep any detailed records and just assume I'm making it all up or am crazy. They offered me a $50 "in good faith" even though they claimed there was no error. I accepted but wanted the balance of my charges returned.
So, after about a month of this, I initiated a charge back. I understand that this procedure is generally favorable to the cardholder, and I probably won't have to pay any of those charges. However, they're quite upset now, and say they will send my bill to collections and ding my credit report. I really don't know what my options are. My credit is excellent, and I want it to remain so, but I don't really need to apply for anything credit related for at least the next couple years.
Should I take them to small claims court? Do I wait and just deal with the credit agency? Assuming I haven't made some gross error in understanding what's going on (and I've checked again and again because it doesn't make sense to me why they don't see that the charges are invalid), shouldn't I have a clear case? Will that prevent any damage to my credit score if I can win a claim? It just seems that they could make up any amount of money and send me a bill, then ruin my credit if I don't pay it, that can't be the way it works.
Thanks, this is making me so frustrated and stressed out, I wish it would just go away but I'll be damned if I'm going to cave in and give this company cash for services they didn't provide and reasonably should know that they aren't owed. I'm going to try to talk to a lawyer this week but I can't really afford to spend hundreds of dollars to figure this out.