There has been some confusion about the so-called “discount” that Apple Inc. negotiated with card issuers that makes Apple Pay transactions correspond with the lower card-present (CP) rate, rather than the higher card-not-present (CNP) rate.
It is confusing. A Sept. 16, 2014, Mercator Advisory Group blog post might clarify matters a bit. In the blog, Mercator analyst Nikhil Joseph wrote that credible reports suggest Apple “seems to have negotiated with card issuers for discounts worth 15–25 basis points on each Apple Pay transaction in exchange for the reduced fraud levels ensured by Touch ID.”
Joseph went on to say that a Bank Innovation report claimed that the “networks have agreed to process all in-store Apple Pay transactions initiated via near field communication technology on the new iPhone 6 at ‘card-present’ rates. In-app purchases made through Apple Pay, however, will continue to be processed at ‘card-not-present’ rates. This is despite the fact that from a technical perspective, very little that is different is happening in either case.”
But it is clear that CP versus CNP can add up to a lot of money. “Stripe, a popular payment gateway services provider that has announced support for Apple Pay, currently charges merchants/developers 2.9 percent and 30 cents for each successful transaction it processes,” Joseph wrote. “Card-present rates for in-store credit card transactions, on the other hand, cost merchants about 2.10 percent and 10 cents per transaction a difference of more than 80 basis points. For a hypothetical merchant that does business worth $10 million annually through a mobile app with an average ticket size of $50, this difference in payment taxonomy could mean as much as $120,000 in lost profits for the year.”
FYI Just found out that this shyster Michale Cooper is back now as Smith Associates which is not a registered company let alone a legal firm and Michael Cooper is still the perpetrator.
NEW UPDATE 10/21/14!
Newest name and website!
Here is the address they use on the email they sent:
Cohen Associates, LLP
One Grand Central Place
60 E 42nd St, Suite 580
New York, NY 10165
THESE SCAMMERS HAVE CHANGED THEIR NAME AND WEBSITE AND ARE CURRENTLY BEING INVESTIGATED BY THE U.S. POSTAL INSPECTOR!
Their new website is http://www.ssmithassociatespa.com
There is a company out there called Homeland Arbitration, homelandarbitration.com. They are also previously known as FIAD Services and other companies all owned by Michael Cooper.
This company contacts small businesses and tells them that they will help them get all their money back for free-they just need to pay a percentage fee on the amount they recover. To recover this money, the small business sends Homeland all their CC statements and any contracts they have with any company they had spent money with. Homeland (not the small business) starts initiating frivolous chargebacks.
And it gets worse – Homeland actually changes the contract verbiage before they send it in to give them a better chance of winning the chargeback. The individual in this chargeback was called and he stated that they had changed his contracts before sending through the information for the chargeback as well. This individual also stated that he told Homeland not to initiate chargebacks and they did it anyway.
Here is a copy of the unsolicited email Homeland sends to people.
I received your contact information off of a website that more than likely was built by one of the companies we are investigating. These companies are known as “Online Business Opportunity Scam” companies charging anywhere between 10 and 100 thousand dollars for marketing, coaching, mentoring, tax services, and then never providing the services that were paid for by the customer. Numerous clients have confirmed this exact scenario and I wanted to go over some qualifying questions with you regarding your website. The qualifying questions to begin an arbitration case for you are as follows:
What companies have you dealt with regarding your home based business?
When did this all begin for you?
How much do you think you have spent with all the companies you dealt with concerning your home based business?
How did you remit those payments?
Is xxxxx.com the only website you have?
What have you done so far to recover the money spent with these companies?
A little about us, there are no upfront fees for our service. We build and work the entire arbitration case from start to finish, strictly on a contingent basis. Our fee is only applicable at the point in time that the case has been won and the money has been refunded to you. Worst case scenario if we happen to lose your case, there will be NO FEE. After we receive your documents and assess your particular scenario, then we will be able to accurately quote you a fee percentage. We would send you our contingent service agreement which allows us to represent you in the arbitration case, and it would also have the quoted fee percentage. Again, you are not paying any of it upfront, it is just acknowledging that you understand what you would be responsible for at the point of time that the money has been recovered. Should you choose to accept, you would simply print it off, sign it and send it back and we would confirm and finalize your case and start filing.
4023 Kennett Pike, Suite 519
Wilmington, DE 19807
Direct Line: (302) 544-9014
Tel: (800) 659-5094 Ext. 218
Fax: (302) 300-4216
Below are links regarding this continuing scam.
If this company initiates chargebacks for your purchasers you should do the following
-When answering chargebacks include your “statement of harassment” (use those words)
-You should also get a cease & desist order against this Michael Cooper
-call police first and see if they’ll do anything
-have your attorney go to court as soon as possible. As this Michael Cooper has a track record of violations it should be relatively easy to do quickly as the court records will show his violations.
The old man needed some ammo for his home protection gun, so he went to the gun shop to buy some stuff.
When he got ready to pay for his purchases of gun powder and bullets,
the cashier said, “Strip down, facing me.”
Making a mental note to complain to the National Rifle Association
about gun control wackos, he did as she had instructed. When the
hysterical shrieking and alarms finally subsided, he found out that she
was referring to how he should place his credit card in the scanner.
He has been asked to shop elsewhere in the future.
First Data has learned of a widespread phishing attack telling recipients that their merchant ID has been locked. The phishing attacks have been by email as described below as well as through unsolicited telephone calls.
Unsolicited email containing errors, such as misspellings, should always raise a red flag, especially if combined with a call to action, such as calling a toll-free number or clicking on a link. If your merchants receive an email similar to the one below, immediately have them delete it from their inbox and deleted items folder. Please tell them to not open any attachments on the email. No further action is required on their part.
If you called a toll-free number in response to an unsolicited email or phone call and gave your merchant ID, please have them contact the merchant services number on their statement so that First Data can help monitor their account for fraudulent activity.
First Data is constantly monitoring for these types of emails and phone calls. We are working with law enforcement officials to take down these phishing sites and to pursue these criminals. If you receive emails or unsolicited phone calls in the future that you suspect are phishing, please let us know right away.
Below is a copy of the current phishing email message. Note the indicators in red that show this is a phishing scam.
From: FirstData [mailto:firstname.lastname@example.org]
Sent: Monday, February 10, 2014 9:58 AM
We regret to inform you that your merchant account has been locked. ← no specific account number provided
To continue using our services please call our tool free number XXXXXXXXX and update your information. ← misspelling and no specific merchant services listed
Please be ready with your Merchant ID and Terminal ID number. ← no description of process to unlock account
As you know in the last few years some card issuing banks have begun rejecting legitimate chargeback replies even though merchants are filling the replies out in great detail proving the original charge is legitimate and the chargeback complaint should be removed and decided in favor of the merchant (you). It has gotten so bad that on some of the chargebacks a 5 year old child could see that the cardholder is simply trying to steal merchandise and/or services from the merchant (you!).
Since MC/Visa/Discover/Amex remain sitting on their hands about this growing problem it’s time for us to fight back any way we can!
Starting immediately I am advising all merchants to put the below wording in your replies to chargebacks. I wouldn’t put it in a retrieval request as that is usually a sign that the card issuer is honest and any decent reply from the merchant will satisfy the inquiry. Put it right at the top of your reply-don’t be shy. And don’t worry about being “nice!” The card issuers aren’t being nice to you so until we can get the government to force MC/Visa/Discover/Amex to rewrite their unfair antiquated chargeback policies and procedures let’s do everything we can.
Wording to insert in Chargeback reply
TSYS chargeback guidelines
Report banks for frivolous chargebacks which is a violation of Federal Regulation E and Z
More complaint info at
This why I love the http://www.natb.org/! They screen their exhibitors to include only vendors that benefit their members.
The real facts about “Square” for mobile phones! Don’t let anyway talk you into using Square. Credit card info isn’t properly encrypted so if someone suffers identity theft you could be out thousands of dollars. They are not used to high volume transaction or daily volume so will quickly freeze your account and you’ll have to wait 6 months for your money.
Here’s the real deal regarding “The Square” mobile credit card acceptance. They are an aggregator so be prepared to wait for your funds and no customer service and zero help with chargebacks!
If you are thinking about using them or already are do the following:
-ask Square to come speak with you in person. Of course, Square does not have an outside sales force, so no rep will show up. This demonstrates a strong difference between a standard merchant account, where you have a dedicated account representative, and Square.
-call Square right now and ask them about your last transaction just to see when it will hit your account! What? They don’t have a 24/7 customer service phone number? With a regular merchant account you get live domestic 24/7 customer support.
Remember Square is built from venture capital and at the moment faces imaginary gains and real losses. There are doubts that Square can adapt to the upcoming Europay/MasterCard/Visa mandate. The new criteria for processing physical cards will force Square to launch newer, more expensive hardware that they have admitted will be difficult or cumbersome to integrate with their mobile app that is not tied to an actual merchant account.
Here is a much better option (attached) using eProcessing’s ePNMobile. You can setup an account for only $49 that comes with a free card reader and also it’s a regular payment gateway so you can login from any computer or tablet and do keyed or swiped transactions that way also.
And View ePNMobile