Chargeback Fraud

Federal regulations give consumers strong rights to dispute charges. Banks often default to believing the customer to avoid regulatory penalties. This creates a shoot first, ask questions later environment.

We help merchants navigate this regulatory bias. We structure their checkout flow and terms and conditions to create a bulletproof evidence trail. When a dispute is filed, we use the specific language of Regulation Z to argue that the bank has no legal basis to grant the chargeback. We demonstrate that the consumer failed to attempt to resolve the issue with the merchant, which is often a prerequisite for a valid dispute.

The process of fighting a chargeback is called representment. If that fails, the case can go to arbitration with the card network. This is a quasi-legal proceeding with strict evidentiary rules.

We take over this process for high-value disputes. We do not use template letters. We draft legal briefs that present the compelling evidence required by Visa and Mastercard. We track the user activity on the website to show they accessed the digital product after the purchase. We use social media evidence where the user is wearing the stolen item. We fight to win the arbitration and recover the funds.

Using a phone or the internet to submit false refund claims can expose individuals to wire fraud and access device fraud charges under statutes such as 18 U.S.C. § 1343 and § 1029. In many cases, prosecutors attempt to expand liability by charging each disputed transaction as a separate count, significantly increasing potential penalties.

A key defense strategy is to challenge the scope and application of these statutes. Where the individual is the legitimate cardholder, we argue that their conduct does not fit the traditional definition of access device fraud, which is typically aimed at unauthorized use or stolen credentials. The distinction between misuse of one’s own account and true identity-based fraud is critical.

We also examine the element of intent to deceive, which is required for criminal liability. If the conduct arises from exploiting a retailer’s overly broad or ambiguous return policy, the argument is that the issue is contractual, not criminal. Not every improper refund request rises to the level of fraud.

By focusing on statutory definitions, intent, and the nature of the transactions, the defense works to limit overcharging and reframe the conduct, reducing or eliminating criminal exposure where appropriate.

Many prosecutions target groups that share methods for double dipping (getting a refund and keeping the item). The government charges these groups as conspiracies.

We defend the peripheral members of these groups. We argue that reading a forum post about how to get a refund does not make one a co-conspirator. We differentiate between the developers of the fraud scripts and the users who tried them once. We work to sever our client from the larger conspiracy to minimize sentencing exposure.

We use targeted discovery tools, including subpoenas to Internet Service Providers, to connect disputed transactions to real-world locations and individuals. Delivery records, IP data, and account activity are analyzed together to establish who received the goods and initiated the dispute.

Once identified, the focus shifts to full recovery. This includes not only the value of the merchandise, but also chargeback penalties and legal costs. The legal theory often centers on intentional misconduct, framing the false dispute as a deliberate act rather than a simple billing error.

This approach serves a broader purpose as well. By holding individuals personally accountable, it creates a deterrent effect, signaling that fraudulent chargebacks can lead to direct legal consequences rather than being absorbed as routine business losses.

For merchants, the ultimate threat is being placed on the MATCH list (Member Alert to Control High-risk Merchants). This is a blacklist that prevents a business from opening a merchant account anywhere for five years.

We represent merchants fighting to get off this list. We argue that the issuing bank placed them on the list in error or without sufficient evidence. We litigate against the payment processors who failed to protect the merchant from fraud. We negotiate with the card brands to reinstate the processing ability of the business. We understand that for an online business, the MATCH list is a death sentence, and we litigate accordingly.

In criminal cases, we argue that the defendant genuinely believed they were entitled to the refund. If a subscription was difficult to cancel, or if the terms were hidden, the dispute was not fraud; it was a desperate attempt to stop a billing cycle.

We present evidence of the confusing user interface. We show the emails where the client tried to cancel. We use the good faith defense to negate the criminal intent. We argue that a frustrated customer is not a felon.

Often, a client is accused of chargeback fraud when their account was actually compromised. A third party may have used their card to buy goods and ship them to a drop house.

We use forensic analysis to prove the account takeover. We show that the IP address of the purchase did not match the home of the client. We argue that our client filed the chargeback because they were a victim of identity theft, not because they were committing friendly fraud. We turn the tables and show that the prosecution has targeted the wrong person.