Federated Payments Merchant Services scammed, misled Melville New York

This goes out as a warning to anyone considering doing business with Federated Payments.

We had a sales rep from Federated Payments come into our place of business, pitching to us the necessity of a debit machine. We initially said that our business wasn't big enough and didn't do enough sales to warrant the use of a debit machine. He was very persistent and adamant; then proceeded to offer us a 30-day no obligation free trial.

In order to receive the machine for trial, we had to fill out a form. We also agreed to pay for the shipping and 5 business days later, we received the debit machine. After 3 weeks of use, as we had originally speculated, we only did a few small transactions and found that we really did not need the machine and wanted to return it. The rep said that we had to contact head office and that the return had to be done through them.

We phoned Federated Payments' head office, which is based in New York with a Canadian office in Montreal, asking what the procedure was to return the machine. They informed us that the so-called 30-day free trial form that we signed was in actuality a contract and it was going to cost us $500.00 to terminate the agreement.

As it also turns out, they said that they did not offer a 30-day free trial. The Federated Payments rep lied to and misled us, thus duping us into signing the contract. Even after explaining the situation to a corporate executive at Federated Payments, they still maintained we had to pay the $500.00 in order to be released from the agreement.  In addition, upon termination, if the machine did not arrive back at the head office within 9 business days, we would be charged an additional $900.00, their cost for their debit machine. We expressed the machine back and got it to head office within the 9 business days.