On October 18, 2004, a customer, in Europe, placed an order for our company's product. Terms with the customer is credit card prepayment. After processing the customer's credit card and receiving approval, parts were shipped. Amount of the transaction was $3,680. After several days, I received a letter from Innovative Merchant Solutions which stated:
"The IMS Risk Management Department has reviewed the recent batch activity for your merchant account. We noticed unusual activity was processed. IMS initiated an investigation on your behalf for verification/confirmation of the sale(s) with the cardholder bank. However, the investigation was not successful as the card issuing bank was not able to verify the transaction with the cardholder. Therefore your batch has been suspended until further investigation is conducted."
I placed 3 calls to their customer service. On the third call, Marian told me they still have not received a reply from the cardholder's bank. She said "we cannot release the funds because the cardholder has up to 9 months to dispute a charge and we have to cover ourselves". She then asked for proof of the shipment at which I agreed to send. Then I mentioned this customer was a repetitive buyer and that she should have record of past transactions. She replied that they took over processing transactions for Intuit/Quickbooks from Wells Fargo a few months ago and don't have history of past transactions. She then asked to see proof of past transactions.
At that point, I was skeptical of her requests. We then checked with the customer who bought the product, and she said she already received a transaction report from her bank, verifying the payment. I replied in a fax to Marian at Innovative that I deny her the right to all the information she has requested and that it was not her job to act as an "escrow" service on my customer's behalf (refering to her request for proof of shipment). In short, the cardholder's bank had paid on the transaction 3 weeks ago when it was originally processed. Innovative Merchant Solutions has been holding my company's money for 3 weeks. Not only the amount of the transaction in question, but the entire batch of $4,531.00. Please tell me what I could do. They can go on like this for the next 9 months!
Previously with Wells Fargo (whom Quickbooks used prior to buying IMS), nothing of this sort has happened. I am convinced I will switch merchant services.