Six Separate Chargebacks, Two Different Banks

The Basis for the Dispute

In November 2022 S.F.M. found what he thought was a promising opportunity to make a substantial profit. A resident of Mexico, he came across a Spanish-language website that offered CFDs, or contracts for differences, as well as stocks. A CFD is an agreement between an investor and a broker to exchange the difference in a financial product’s value between the time the contract opens and the time it closes.

Whatever doubts he may have had about the site were soon dispelled by the representative of the brokerage who spoke with him by telephone. He assured S.F.M. that he would only transact in stocks, commodities and other governmentally regulated financial products. Moreover, his funds would be deposited in a personal, segregated bank account, and he would be able to withdraw them at any time. 

That being the case, S.F.M. made his first deposit and almost immediately began to see profits accumulate in his account on the broker’s platform. He was impressed and continued to deposit even larger sums of money. And he was quite satisfied with what he presumed to be his success. When his deposits reached $8,577, he asked to withdraw it, together with those profits shown on the platform. “I realized they never deposited what we had agreed,” he recalled.

The brokerage agreed to refund S.F.M. only $500.00. Another $1,136 was also returned to him after he filed a dispute with his bank, but the reason was unrelated –  two of his credit cards were charged four times without his authorization, which is fraud. Adding insult to injury, the brokerage charged him just under $1,000 for supposedly creating a mirror account into which they would return his presumed profits, which, of course, they did not do, since the profits were entirely imaginary.

S.F.M. finally had enough and contacted MyChargeBack.

Strategies and Tactics

Upon receiving the case, MyChargeBack advised S.F.M. to notify the brokerage that he was canceling its services. We knew from experience that the brokerage was not licensed or regulated, did not even claim to be licensed and regulated, and did not even provide an address on its website. These are telltale signs of a scam. 

In fact, the brokerage was also the subject of a warning issued to investors issued by the Spanish financial regulator, the Comisión Nacional del Mercado de Valores (National Securities Market Commission).

We then proceeded with the chargebacks, which was no small challenge, because S.F.M. made six separate payments to the merchant, three using a Visa card and three with a Mastercard. Two of those Visa cards and one of the Mastercards were issued by one bank and the other Visa and two Mastercards by a second bank. 

Even though the reasons for the chargebacks were the same, chargeback rules required separate disputes to be raised with the two banks for each credit card. So our work was multiplied six times. Of course, so was the work of the banks. What made all of this even more difficult was that two different card networks were involved, each with its own chargeback guidelines, and two different banks, each with its own dispute department. There was no guarantee that their decisions would all be the same, let alone that all of them would be positive. But they were. The merchant lost all six disputes and S.F.M. was reimbursed in full.   

The MyChargeBack Difference

These cases required extraordinary experience and professionalism. Visa and Mastercard have different chargeback guidelines, so the documentation that MyChargeBack had to prepare had to be tailored separately to meet each network’s rules. But because bank dispute departments, which have to raise these disputes, are often unaware of the subtleties in the differences between Visa and Mastercard, we had to know how to explain them to them and convince them that they could rely on our knowledge. 

One of the ways in which we were able to do that was to prove incontrovertibly through extensive research that the brokerage in question was unlicensed and operating outside the law. S.F.M.’s banks did not know that at the time. Now they do.