Travel fraudsters swindled holidaymakers out of £7m last year

[PAXboy]

Many get caught, even regular travellers: Travel fraudsters swindled holidaymakers out of £7m last year - and the problem is growing - News & Advice - Travel - The Independent (http://www.independent.co.uk/travel/news-and-advice/travel-fraudsters-swindled-holidaymakers-out-of-7m-last-year--and-the-problem-is-growing-9166618.html)

Nearly 5,000 cases of holiday booking fraud were reported in 2013. The single most lucrative fraud is for holiday accommodation. Three out of 10 holiday fraud victims were scammed by fake advertisements of villas and apartments.


Most of these involved properties abroad – but fraudsters are also targeting domestic holidays. A Yorkshire couple who thought they had bought a Loch Ness weekend Valentine's break online were left over £1,000 out of pocket. The “romantic lodge” they had seen advertised on Facebook did not exist. Because they had paid by bank transfer, they were unable to recoup their losses.

[mixture]

If ever there were a good advert for the value of paying for services and high value equipment by credit card, this is one....

If a holiday service provider I had never used before told me the only form of payment they accepted was pre-payment by bank transfer (or equivalent, e.g. Paypal) alarm bells would be ringing like crazy ! Bill me the 2.5% merchant fees the credit card company charges you if you like, but there's no way I'm paying for a £1,000+ holiday on a bank transfer !

[meadowrun]

The “romantic lodge” they had seen advertised on Facebook did not exist.

Google/Bing are your friends.

[SeenItAll]

If a holiday service provider I had never used before told me the only form of payment they accepted was pre-payment by bank transfer (or equivalent, e.g. Paypal) alarm bells would be ringing like crazy ! Bill me the 2.5% merchant fees the credit card company charges you if you like, but there's no way I'm paying for a £1,000+ holiday on a bank transfer !

I'm not sure I would PayPal into this risk bucket. In the U.S. anyway, you can get two levels of protection if you use it. The first recourse is through PayPay itself, if the fraudster is a certified vendor; and the second is through the credit card company that you use to pay your PayPal bill (assuming you use a credit card and not a bank transfer).

[mixture]

I'm not sure I would PayPal into this risk bucket.

Oh I would, for three reasons.

I don't know what it's like for you in the US.... but in Europe you tend to get the benefit of the local Consumer Credit Acts (i.e. the credit card company is jointly and severally liable for any breach of contract or misrepresentation by the seller.) .... so you get protection that's cast in legislation that the companies can't wriggle out of .... rather than some terms and conditions set by a private company. Sure if I pay by Paypal using my credit card, I might still get protection (I'd have to check).... but if I pay via bank transfer via Paypal I'm still back to square one.

The other issue with Paypal is their forex rates are poor.

Finally, as you may well know from some of your home grown products (e.g. AMEX), some cards offer additional perks such as bundled travel insurance if you buy on the card.

[Hipennine]

I seem to recall reading somewhere that because Paypal is an intermediary not a vendor, you do not get the normal Credit Card protection even if you use your CC to pay via paypal.

[mixture]

I seem to recall reading somewhere that because Paypal is an intermediary not a vendor, you do not get the normal Credit Card protection even if you use your CC to pay via paypal.


That was my impression too that you have no direct payment relationship with the seller and therefore no protection.

[cockney steve]

Paypal used to have a UK registered office which was purely a maildrop....their offices were in eirland!
When they became unhappy to toe the line that the Financial Services Authoritysets, they decamped...UK Paypall is now offshore in Lichtenstein, outwith the regulation of FSA.
NEVER trust them....look at the "Paypal sux" website, to se what a greedy, unethical crowd they are....well, they are wholly owned by ebay, what do you expect!

Credit card = statutory protection
Debit card = bank's voluntary protection scheme.......
Don't risk it!

[mixture]

AMEX in its charge card form also gets treated like a debit card and so you get a lower level of protection.

Who'd want to use AMEX anyway.... hardly anyone accepts it and its particularly nasty on forex because everything has to go back to USD first..... so if you've got, for example, an EUR AMEX and you buy something in AUD .... you're going to be stung twice.... because they do AUD -> USD -> EUR !

[ExXB]

It's been many years but our corporate card used to be AMEX. At that time whatever local currency was converted to CHF directly, not through the dollar.

We stopped using it because too many hotels/restaurants/etc wouldn't accept it.

Is/was your AMEX issued in the states originally?

[mixture]

From, for example, the UK American Express website (here (https://www.americanexpress.com/uk/content/travel.html?inav=gb_menu_travel_money_abroad))... (my bold)


What exchange rate will be used?
If you make a transaction in a foreign currency, we will convert it into Pound Sterling on the date we process it. Unless a particular rate is required by law, we will use conversion rates based on interbank rates we select from customary industry sources on the business day prior to the processing date (called the "American Express Exchange Rate"). This rate may differ from rates that are in effect on the date of your transaction. Fluctuations may be significant. If the transaction is in U.S. Dollars, it will be converted directly into Pound Sterling. In all other cases, it will first be converted into U.S. Dollars and then into Pound Sterling.

Trying to find the same page for the EUR card.... its somewhere there ;-)

Edit: I think its lurking in the terms and conditions for other cards, for example the French card (T&Cs here (http://www.americanexpress.com/france/sbs_pratic01/pdf/fr-sbs-11-12-cam6310s.pdf)) .....

Si le débit n’est pas effectué en Dollars US, la conversion sera effectuée en passant par le Dollar US, par une conversion du montant du débit en Dollars US, puis par une conversion du montant Dollars US en Euros. Si le débit est effectué en Dollars US, une seule conversion sera
opérée en Euros.

Says exactly the same thing.


[SeenItAll]

A brief search suggests that in addition to filing a direct dispute with PayPal, chargebacks against PayPal may be sought both in the U.S. and UK through your funding credit card company. See
www.paypal.com/webapps/mpp/security/chargeback-faq (https://www.paypal.com/webapps/mpp/security/chargeback-faq) and www.paypal.com/uk/webapps/mpp/chargebacks (https://www.paypal.com/uk/webapps/mpp/chargebacks)

[mixture]

chargebacks against PayPal may be sought both in the U.S. and UK through your funding credit card company

Chargebacks are not the same thing.

Chargebacks are the same thing you get with debit and charge cards.

The additional benefits set out in law of the card company being jointly and severally liable for any breach of contract or misrepresentation by the seller is only something you'll get with a credit card transaction.

In contrast, with the chargeback process, there is absolutely no guarantee you'll get the money back because it is reliant on your card provider first obtaining the funds from the other party's bank account .... if they, for example, go bust or take the money and run.... you'll find yourself back in square one.

Chargeback is basically another term for customer service and goodwill. You're relying on entirely full co-operation from the other party who charged your card to do the right thing and refund you. The chargeback scheme is entirely voluntary.

[SeenItAll]

If a customer complains, no credit card company is going to go to a travel services vendor and try to make that vendor provide the particular services that it promised to provide. All the credit card company is going to do if it finds these services have not been provided is to chargeback the account of the vendor and issue a credit on the customer's statement.

[mixture]

no credit card company is going to go to a travel services vendor and try to make that vendor provide the particular services that it promised to provide.

You are busy chewing on the wrong end of the stick ! :ugh:

What we're talking about here is the clear distinction between credit cards and their debit/charge card counterparts.

The former provides legal protection enshrined in law which gives you guaranteed money back in the event of a valid dispute. The latter do not and, as I've already said above... are a voluntary process relying on the goodwill of the merchant.

The term "chargeback" very specifically applies to debit/charge cards.

Don't know the technicalities of the US, but certainly for European card holders, the difference in protection between credit and debit/charge cards is light and day ! There is no contest, credit cards win hands down.

Edit to add:
Found this on the New York Times website, so it looks like the concept is the same over there too...

Federal law also protects you if you need to dispute charges on a credit card, but not if you use a debit card or other forms of payment. If you paid cash or used a debit card, the retailer already has your money. So you have a lot less leverage, and there’s no guarantee you’ll get that money back. But if you pay for something with your credit card and aren’t happy with the purchase, your card issuer can legally withhold payment from the retailer until they resolve the dispute, and you won’t be charged.

From wikipedia.... my highlighting ....
The FCBA's § 170 gives a consumer the right to sue or assert defenses against the credit company (instead of the actual merchant) in a dispute about the quality of goods or services received, to the dollar extent of the amount of the charge(s) involved.

Hence what I was saying about "joint and several liability above.

[tdracer]

AMEX in its charge card form also gets treated like a debit card and so you get a lower level of protection.

Where on earth did you come up with that? AMEX is a charge card, and at least on this side of the pond is legally treated as such. Further, I'd be very, very surprised if it's any different in the UK/EU.
Debit cards have very specific rules and regulations, and an AMEX charge card is exactly that, a charge card. Given all the lawyers in the US, they'd be sued out of business in a week if they tried to treat their charge card as a debit card....

[mixture]

Where on earth did you come up with that? AMEX is a charge card

Do me a favour and read what I've said ! :ugh:

AMEX have two products. Charge cards and Credit cards.

If you have an Amex CHARGE card, you DO NOT get the legal protection.

If you have an Amex CREDIT card then you do.

"Where on earth did I get that ? " Quite simple... the fundamental definition of a charge card, that's where ! You are NOT entering into a formal credit agreement with AMEX when you take out an AMEX charge card, plain and simple.

A charge card is an agreement for running account credit which provides for the making of payments in relation to specified periods and requires that the entire credit be repaid in one installment. Another example of running account credit is a bank overdraft..... so you could say in other words that a charge card is basically an agreed overdraft that you've taken out with a card company.

A credit card is an agreement for revolving account credit which allows you access to a continuing balance of debt (subject to interest being charged) which you can pay back at your leisure.

They are clear and distinct financial protocols, and therefore running account agreements are NOT subject to legislative protection which covers provision of consumer credit. ONLY Revolving account credit agreements are.

[SeenItAll]

Mixture: Maybe you are discussing the difference between credit card and charge/debit card protections (and I agree, there are many), but my posts are related to the question of whether PayPal (funded by a credit card account) is less protective than using a credit card directly. My analysis is that it is not.

[mixture]

Well your "analysis" is flawed, broken and not at all thorough. I've already explained above why, and if you do not wish to accept you are wrong in the face of hard facts , then let's just agree to disagree and leave it at that.