especially ones that are doing continuity programs/free trials/negative options, are using company names/brands or content that they do not have rights to (i.e. Google) or are in certain categories that they are having major problems (i.e. grants, get rich quick, etc.). Recently, they have closed down any merchant with anything to do with Google (i.e. Make money on/with Google) and I’m sure they will go after other similar merchants next week (i.e. make money from Facebook, Yahoo, YouTube, etc.). MasterCard is also discussing a registration program for all direct marketers (fees, forms and review) prior to that merchant being able to process with any acquirer. Stay tuned as this program develops.
This is VERY serious, as they are/will be fining merchants, MSPs/ISO’s, Acquirers and anyone else that is helping merchants $100,000, especially ones that help merchants open multiple accounts with multiple acquirers, or ones that are working with merchants to change their descriptors or setup new corporations to elude the chargeback monitoring program. Below are things that they are looking for and each acquirer will be looking for with these merchants. I will let you know if they release an official bulletin over the next week or two (expected).
- In depth website reviews for merchants selling nutraceuticals, debt relief, get rich quick, teeth whiteners, grants and similar
Carefully review the terms and conditions – “Free” offers, negative optional renewal
Evaluate the refund policy / ease of use
Scalability of customer service
Presence of up sells and / or cross sells
Potential data sharing across merchants
Pre checked boxes placed beneath the payment submit button
Payment terms — number and amount of transactions – transaction splitting
Merchant descriptor prominently disclosed
Mandatory charitable donation as part of sign up
MATCH inquiry on Sponsored Merchants or “Suppliers”
- Examine signed sales amount compared to past sales performance, time in business
- Use of multiple descriptors or merchant ID’s
- Re underwrite if signed sales volume exceeded in first month / first few months
- Monitor descriptor activity
