I used to work on Baker Street, but I’m no Sherlock Holmes.

In February this year I was delighted that we had sold a Miele Master Cool freezer over the phone with a retail value of over £11K. The purchaser asked for an invoice to be sent out and he would pay by bank transfer. We had a name, email and invoice address. All seemed fine.  

The purchaser then phoned to say he would prefer to pay by credit card over the phone as he was not in London, so I authorised the payment on the basis that we had all the purchaser’s details. Alarm bells started ringing when the purchaser used two different cards across four transactions.    

I was suspicious, so I checked with Miele to see if they had the purchaser on file, but they had nothing on record. I also asked if any other retailers had been defrauded recently as I remembered a Miele fraud case many years ago when we lost money.

Hunting for clues

I phoned the credit card company who told me that there is a limit which does not invite investigation, so by spreading the cost over four payments the purchaser kept below the magic number.

The credit card company said no offence had been committed (up to this point), and that they could not check with the purchaser to see if their card had been acquired. Surely, you’d think they could ask the card holder if they had recently bought a freezer?

So, could I phone the purchaser and ask them to come in to the showroom with proof of identity? If it’s a genuine transaction, would they contact Miele and give us a bad rating on social media?

I decided to check out the delivery address which turned out to be a new build on an estate in Basildon. We had processed the card by entering the numbers of the house and the postcode, so surely it should all be okay? We found out later that if the card is an overseas business credit card then this check does not work.

What next? Swiftgo, Miele’s delivery company, wanted to do a survey – excellent! However, the purchaser said, “there’s no need to do that because it’s ground floor”. But we insisted and then he said he would take delivery kerbside and have his builders see it in.

Enough is enough! I said “no survey, no delivery” and our purchaser disappeared. I am a happy bunny, but did we have a lucky escape?

Whodunnit?

In March, the four transactions were eventually confirmed to be fraudulent. Even though we flagged our concerns to our payment processing company, they stopped our account for a period while they investigated us (as if we were the criminals!).

We have been charged over £800 in transaction and chargeback fees for this fraud, and that’s not even mentioning the cost of the amount of time we spent trying to understand the process.

In my experience, the retailer, even though acting with due diligence, is the only loser. The person whose card has been acquired gets their money back, and the banks and the payment processing companies don’t lose out either.

My advice is to always use extreme caution when taking credit cards over the phone. Also, watch out for high goods values and no discount, multiple transactions, and transactions at the beginning of the month.

Phone numbers, email addresses and site addresses can all be falsified. You will still have to absorb the transaction costs even if you act diligently! Oh well, it could have been worse…it could have also cost us the price of a Miele Master Cool freezer.

What do you think? We always want to hear your views and opinions, so email [email protected] to be featured in a future issue.