Q: You have written
that the only way to ensure that you will not have to pay an
airline debit memo for a credit card chargeback is to have obtained
a manually imprinted and manually signed Universal Credit Card
Charge Form. As you know, it is impractical to meet those
requirements for telephone or Internet sales. Isnt there another
way to guarantee against chargebacks for sales not made in person?
A:
Until recently, I would have agreed with ARCs recent statement in a
fraud alert that the only way to fully protect yourself from
potential liability resulting from credit card scams is to obtain a
physical imprint of the credit card and the original signature of
the cardholder on a Universal Credit Card charge form in addition
to the approval code.
However, in reading
the September 2004 revisions to the ARC Industry Agents Handbook,
which is online at www.arccorp.com/iah/IahOn line.jsp, I came
across an unpublicized, alternative that works just fine for
telephone and Internet sales with Visa and American Express cards
only.
Section 8.4 of the
handbook now says ... travel agents will be relieved of liability
for debit memos that are issued as a result of a credit card
chargeback provided that the credit card acceptance pro-cedures
described below are followed.
Those procedures
are probably already familiar to you: Obtain an authorization code,
verify that the card expiration date hasnt passed and verify that
the card exists.
Then, for Visa and
American Express charges, you can get a guarantee against
chargeback if you strictly comply with the address verification
service (AVS) procedures on Page 4 of Section 8.4, using the
following steps:
Do an AVS check
through a GDS and issue the ticket only if there is a positive
match. Issue a paper ticket, as the guarantee does not apply to
e-tickets.
Deliver the ticket
by certified mail, Express Mail, or a local or overnight courier
service to the same address. Retain proof of delivery. A signature
on the delivery log is not necessary if the post office or courier
service certifies that it delivered to the address.
If you get a debit
memo or request for information, you must respond within five
business days (seven if the communication comes by mail) with
documentation of the sale, such as proof of the delivery and proof
that you were dealing with the cardholder. Therefore, it is a good
idea to keep a copy of the card and the cardholders drivers license
in your files for just such an occasion.
These steps seem
reasonably practical and should be used whenever you deal with a
client whom you do not completely trust. Even if you trust the
client, these steps will protect you in case the client never pays
his credit card bill or files for bankruptcy.
Mark Pestronk
is a Fairfax, Va.-based attorney specializing in travel law. He
answers your questions in the TravelWeekly.com Legal Ease forum. To contact Mark
directly, e-mail him at [email protected].