Criedit Card Authorizations, Charges, Disputes

Factual Questions
1

Today I was processing my boss’s expense report, when I came across a charge on his Visa statement from a hotel he stays at alot. Except, the amount of the charge on the statement did not match the amount on the receipt.

Figuring he may have charged some stuff, room service, whatever, and didn’t give me the correct receipt, I called the hotel to have them send me a receipt for the amount on his statement.

The merchant, however, said that the amount she showed was the amount on the receipt, not the amount on the statement and to just relax since the higher amount was an authorization and would drop off in a few days.

Now, I’ve worked in the credit card industry and understand what an auth is and what it’s for. I explained that this was a charge on his statement, not an authorization. I asked her to credit his card the difference between the legitimate receipt and the charge on the statement, whereupon she refused and said it was not her fault because “we didn’t charge you that amount”.

She wanted me to three-way call with the bank and have the bank credit the difference.

I refused, and told her I’d dispute the charge instead, which I have done.

My questions are these: Is she correct? Is it not her fault that the amount they ran as an authorization ended up on the bill? Is it a valid option to call the credit card company and expect them to issue a credit? How did it happen that the authorized amount ended up being charged to the card? I understand from this thread that she will be charged by the credit card company for investigating the disputed amount?

Lastly, I don’t know how it works when you take credit cards. How do you eventually get the revenue that was charged to a credit card? I assume that because the higher amount was what ended up being charged, that she’d get that in revenue from her merchant services provider? IOW, let’s say the receipt says $20, but the statement says $50. I assume at some point she’ll get $50?

2

If it’s a pending transaction, it will drop off. If it’s a transaction, it stays, AFAIK.

3

Yep, that’s my understanding also. My question is how can she legitimately claim that the pending amount ended up being charged and that she bears no responsibility? Clearly, it’s no longer “pending” nor an authorization once it appears on the statement.

4

Pending transactions appear on my online statements. Quite honestly, I’ve never looked at an actual paper card statement. How old is the charge?

5

They could’ve put thru a charge as a payment accidently to your boss’s card. Then reversed the payment charge.

So let’s say hotel puts $100.00 charge through on Monday. Gives boss bill. Then on Monday afternoon they charge another $50.00 incorrectly

Tuesday controller reviews and says you’re credit cards don’t balance.

Wednesday credit card sends out statement

Thursday auditor gets around to reversing off $50.00 charged in error.

You call on Friday and the clerk doesn’t check the history just the amount, so to her it is fine.

You did the correct thing. DISPUTE the charge. This is an insanely stupid way to do business since a merchant gets charged with each dispute even if the merchant is correct. They will be charged.

Can you go online and check the balance? You usually can see what happened.

Also there may be some “funny accounting” going on at the hotel. Such as charge a bunch of accounts in error and by the time the thing clears it’s a mess and the controller is sloppy or too busy to care.

Dispute the charge.

A merchant that submits their receipts online should have them updated by midnight of the day after the submission. If they submit by mail, it should be by the next billing cycle. But very few people but small business submit by mail anymore.

6

But if they charged him twice, wouldn’t it show up as two seperate charges?

Explain more what you mean by going online to check the balance to see what happened? You mean by checking the daily balance?

What does having your receipts updated mean? (I’ve never been on the merchant side of credit card processing.)

7

I assume that the merchant assumed I was looking at an online statement, but I explained to her that I was looking at the actual, physical, paper bill showing how much we owe the card.

The charge was only a few days old. The day he checked out and the billing cut off date are one day apart. There is no credit on his online post-statement activity.

8

Whoa. Just checked his account online, and the receipt amount now shows up in his current activity! So, now the I think we have our answer. Somehow he got charged for someone else’s bill, it looks like.

Great. Now I get to dispute the entire charged amount. I hope, I hope, this is a second chargeback, and not just a revision of what I submitted today.

9

Bump?

10

Why are you bumping this? In post #8, you said you had your answer. What more assistance do you need from the Teeming Millions?

11

Notwithstanding that you seem to have resolved the problem at hand, she was not correct. An authorization will never show up on a bill until it is settled by the merchant. These are usually two separate steps. The merchant has to ask to explicitly put settlement through, although smaller merchants probably depend on a third-party service to manage this for them (I managed payments & billing at a large online merchant, millions of transactions per year). Then when you settle, the banks transfer the funds from the card issuer to the merchant bank. If the statement say $50, then the transaction was settled for $50, and the merchant will get $50.

As already stated, if the merchant refused to correct the charge then the next step is a chargeback. However, it is usually best to deal with the merchant first.

12

Yeah, fair question. I meant that for me the question was answered, because there is no way the erroneous charge could be the authorized amount as the owner stated, because clearly the correct charge has come through. What I still wanted to know, however, is to be certain in my understanding that what she claimed to have happened couldn’t have happened. That somehow 1) the credit card bank charged the auth amount to the card instead of the official transaction amount, and 2) that she bore no responsibility, and 3) that once the amount appears on the cardholder statement that it will not, as she claimed, be credited back automatically.

Clear as mud? Yeah, I know. I’m just on the warpath and I want to know I’m right. I’m also wanting to be certain in my position as I plan on writing a letter to her hotel’s corporate office and I don’t want to give her an out. At this point, yeah, the issue is different (an unauthorized charge as opposed to an overcharge), but I still want to arm myself with information to refute her bullshit.

And, frankly, to feel 100% ok with asking my boss not to stay there anymore.