3D Not so Secure Then??!!

[brian.mc]

We have today received a chargeback - only the second in over 2 years, since we first signed up to 3D Secure. We also received a letter from Cardnet stating:-

I have received a Chargeback from the above cardholders issuing Bank, the cardholder denies participating in this transaction. We have previously attempted to defend this Chargeback by supplying evidence the transaction was authenticated by Mastercard 3Dsecure.

The cardholders Bank, who are based in the USA are disputing this transaction is included within the 3DSecure/VBV liability shift. Under Mastercard and Visa International rules, as of 1st February 2007, any Commercial/Business or Purchase card issue by a Bank outside of Europe is excluded from the Merchant liability shift. The liability for fraudulent transactions lies with the Merchant, unless the transaction is fully secured by the purchaser inputting the pin code registered to that card.

I have checked the records for this transaction and can confirm the card is a Commercial card. We are unable to defend this transaction further on your behalf. In accordance with the Terms and Conditions of your Retailer Agreement, I regret I have no option but to debit your Company's Bank account with £60.96.

I have checked the original transaction on SagePay, and there is nothing to indicate whether the card was Commercial or Personal.

It seems, therefore, that we have absolutely no guarantee of protection when a card is issued outside Europe.

So much for previous promises from the Banks that all transactions would be guaranteed by 3DSecure/Verified by Visa.

[Duncan Rounding]

Yet another way for the bank to pass the buck it seems. (pardon the pun)

[Darren B]

oooh bugger, i was led to belive that all transactions if verified by visa or mastercard would mean no chargeback could be made.

Another typical get out by the banks, so does this mean i now refuse to ship to these countries as you have no come back for fruadulant use even though this is exactly what the scheme is suppose to stop.

[cbarling]

Unfortunately 3D Secure doesn't protect you against all charge-backs. In particular, when it does protect you, it only does so against chargebacks where the buyer claims that they didn't participate in the transaction.

There is no protection against buyers claiming goods weren't delivered, were defective etc.

Chris

[brian.mc]

Chris, in this particular case, the cardholder denies participation in the transaction. Until today I thought I was fully protected in such circumstances.

To be fair, I have had only 2 chargebacks since June 2007, when I first implemented 3DSecure, which is still a vast improvement on previous performance, but I'm annoyed Cardnet didn't inform me of this loophole when I signed up.

[Darren B]

Chris, in this particular case, the cardholder denies participation in the transaction. Until today I thought I was fully protected in such circumstances

And that is exactly the way i understood it aswell, i have never had a charge back for a non delivery as this is not the customers fault so would never adopt the attitude "i sent it its not my fault"

[cbarling]

Actually, that was my understanding as well so it's news to me that it doesn't apply to foreign cards.

Chris

[Darren B]

Actually, that was my understanding as well so it's news to me that it doesn't apply to foreign cards.

Chris

it sort of makes the scheme less attractive, well worthless if you do alot of foreign transactions

you can always rely on a bank or card company to kick you in the n***s though

[Duncan Rounding]

Do US 'company' card holders share the same pin and card then?