ATLANTA — Scammers are taking advantage of credit card fraud protections that consumers count on to steal from small businesses.
“In six months, I’ve had about 10,” Utopia Foot & Shoulder Massage owner Julie Stewart said.
After getting services at the spa, the scammer reports to their credit card company that the charge was fraudulent.
“They’ll typically get our nicest service, the most expensive, and then they’ll purchase products. And then the next thing you know, I get a charge back from the credit card company claiming fraud,” the Grant Park business owner told Channel 2 consumer investigator Justin Gray.
At French Market Flowers in southeast Atlanta, Matt Riley said they’ve had the same thing happen multiple times this spring.
Big-dollar flower arrangements are ordered, created and delivered or picked up, and the customer then claims they never received.
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“We’re artists. We’re assembling this for you. We’re giving this to you. And then you just say I didn’t receive that. Or I have no knowledge of that chargeback. And I’m very aware that I spoke to you on the phone,” Riley said.
Stewart said what’s even more frustrating is that she’ll provide the credit card company with a paper trail and even evidence from surveillance cameras.
But usually, the business still ends up on the hook for the charge, plus fees.
“I think it’s really sad. I know we’re in a bad time right now. Money’s tight and people are careful, but we’re also small businesses, too. So, it goes both ways. We’re all trying to survive,” Stewart said.
And when small businesses take a financial hit, legitimate customers do too.
A 2024 survey by a company called Chargebacks 911 found that 32.5% of the companies they surveyed said the cost of credit card chargebacks has influenced their pricing.
Riley said that’s something he’s trying to avoid.
“That is money to our team, that’s money to delivery drivers, that’s money to keep me stocked with flowers that you yourself as a customer can come and enjoy. So, we can’t take those losses every day,” Riley said.
French Market Flowers has stopped taking credit card orders over the phone to try to have more of a paper trail and better avoid the improper chargebacks.
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