Chargeback Fraud: ‘My Hands Are Tied. How Is That Fair?’

by Csilla Dali September 26, 2013

I still sell a lot of plane tickets, and there are plenty of agencies and consolidators out there who are affected by this issue – I’m talking about credit card disputes and credit card fraud.

*Csilla Dali*

Apparently any customer who purchases a plane ticket can dispute the charges anytime, even after they travel, without having to show proof or reason for the dispute. When I used to work at a consolidator agency we were getting disputes of more than $50,000 a year, which we had no way of recovering.

Here is what just happened to me. I sold two tickets to return customers whom I’ve been working with for the past two years, and I’ve personally met them as well. It was part business class, part economy – the most-restrictive conditions ruled and the ticket was nonrefundable.

To cut the story short, the client cancelled. She decided since the ticket was nonrefundable, she would simply dispute the charges instead of having a $6,000 loss. Now I am responsible for that amount. It’s my loss and my hands are tied. How is that fair? How is it even possible?

We want young people to come into the industry and start businesses, but if we are so vulnerable to such fraud who wants to risk it?

I’ve been researching solutions with no luck for the past six years. So many of my fellow agents are affected by it, I can’t believe nothing has been done.

IATA rules state that we must require an imprint of the credit card from our customers, in order to be protected against disputes and fraud. I find this rule to be very outdated.

Most of our business is currently done over the phone, via email or through our websites. We can’t possibly be requiring them to mail us an imprint; we’d lose most of our customers if we enforced that. Not to mention that credit card companies and banks also advise customers against sending copies/imprints of their credit cards and IDs to anyone whom they do not personally know.

We are practically totally vulnerable and there doesn’t seem to be a clear solution in sight.

I would like to know what steps can we, the travel agent community, take to have these rules updated?

How do we continue building our businesses and ensure that a disgruntled customer doesn’t just knock it down one day, because she decides that the non-refundable policies that she agreed to at the time of purchase just don’t apply to her?

Csilla Dali is the owner of Global Voyages, Inc., in Chicago. She serves on the Board of ASTA’s Young Professionals Society and on Travel Market Report’s Editorial Advisory Board.