Innovative Merchant Solutions Unfair Business Practice Calabasas California

I have a suggestion that may help put this and others like them out of this kind of deceptive practice.

I too was ripped off by Innovative Merchant Solutions. by luck I had a similar thing happen years ago and knew who to call. Call the FTC!

What you should do and not many people know this can be done...

CALL THE FEDERAL TRADE COMMISSION IMMEDIATELY AND FILE A COMPLAINT. THEY WILL INVESTIGATE THEM. I CURRENTLY HAVE AN ACTIVE CASE WITH THEM BECAUSE INNOVATIVE MERCHANT SOLUTIONS BLACKMAILED US AND I GOT IT ON TAPE, AND THEY STOLE FEES FROM A DEPOSIT INSTEAD OF FUNDING THE ENTIRE AMOUNT OF THE SALE THEN DEBITING THE FEES SEPARATELY.

IT IS DECEPTIVE BUSINESS PRACTICE. YOU CAN ALSO PUT BLOCKS AND FILTERS ON YOUR BANK ACCOUNT TO PREVENT THEM FROM DEBITING YOUR ACCOUNTS BUT DEPOSITS WILL STILL MAKE IT TO YOUR ACCOUNT. DON'T TELL THEM YOU ARE BLOCKING THEM THOUGH OR THEY WILL TAKE FEES FROM YOUR DEPOSITS, THEN YOU CAN'T CHALLENGE THE FEE DEBITS AS UNAUTHORIZED DEBITS.
BE SURE TO GET NAMES AND DIRECT EXTENSION NUMBERS AS THEY WON'T GIVE LAST NAMES.

Oops! Sorry for the Caps. Hit the shift lock and didn't realize it.
Anyway... When you call them ( innobvative ), tell them you are taping the call so you are covered and let them know. I did and got them (GUS) on tape blackmailing us with that line they will keep your money for 270 days if you don't do what they say. The more complaints they get, the more trouble they get in.

Also the Woodland hills and I believe Calbassas CA are supposedly BBB members. I will also be filing a complaint with BBB against Woodland hills office.

Luck to all!
DW

My company went out of business and IMS has NOT rescinded the termination fee so this disputes the claim made by the person who said IMS refunds the termination fee for those cases.

Also, it is important for each person to read the laws around "standard contracts" and secondary terms. I know in NJ, terms that are not expressly discussed nor disclosed in the primary document being signed(ie are not the primary basis for the contract) are considered secondary terms.

The termination fee is NOT disclosed on the merchant application where 90% of the fees ARE disclosed. I was never aware of this very steep termination fee and it absolutely would have deterred me from signing up with IMS. With standard contracts, the law realizes that people can NOT reasonably nor will they, read every single line of overly verbose standard contacts. Therefore, if a secondary term can be described as a "deal breaker" like this overzealous termination fee, then the term will not likely be enforceble.

Also note how sneaky they are in billing these fees. Anyone get a sneaky "annual fee" taken from your bank account that was never disclosed in any monthly statement from IMS? Notice the termination fee never shows up in the last montly statement either. They merely deduct it from your bank account. I have all of my documents and am prepaid to present them as needed for any future legal proceedings.

Lastly, they made a verbal agreement to waive these fees for me as PNC bank was soliciting my business and IMS agreed to waive annual and termination fees to keep my business. I can say from my own direct experience and from reading other complaints here and on the BBB site that IMS seems to have a chronic pattern of breaching verbal agreements(ie they will say anything to keep your business and then reneg later).

Anyone who has complaints in the areas I listed above, please contact me at erniejde@yahoo.com. Also, please make sure you file with the Better Business Bureau and the State Attorney General of California. It only takes a few minutes of your time and both can be filed on line.

I am a former employee for one of the marketing firms Tallen Incorporated who marketed the Innovative Merchant Solutions campaign. We were always told to NEVER inform the client about the termination fee UNLESS they asked us, but on the applications you will find it stated in bold blue ink at the bottom right above the signature. For those of you who signed that app, did you notice that the rep kept talking about other things rather than the service?? Yep, distracting tactic used to distract business owners when signing so that they are concentrating on the conversation rather than the disclaimer on the app. To my knowledge however, I will state that IMS is a month to month agreement, and no matter how long you've had service the termination fee will always apply, UNLESS you are going out of business then it is waived. So basically its a case by case arrangement. The reason the termination fee applies, is due to the free activation at the beginning of service, or what they call "out of pocket" cost to setup. Hope this helps!

Dear Tcs,

I had a similar bad experience with Innovative Merchant Solutions and agree something must be done! According to the numerous complaints also on (((REDACTED)))is is how they operate.

I signed up for their services in Jan.08 through the people that make my postcards called merchantsmadeeasy.com. The sales rep responded with answers to my two questions regarding the service. 1) He affirmed That $10.95 a month was my only charge for the service along with the percentage- and that 2) I would be billed by mail as opposed to the money taken directly out of the account, which I liked. Total Nonsense, I made my decision on these answers and they were false. When I later complained to Innovative Merchant Solutions along with other issues, I was told, "It was not his fault, the sales reps don't know all the details." Incredible! The sales rep did not mention to me anything about the handbook, how to acquire one or any specific charges or regulations relating to it.

The real problems started when I tried to process my first transaction. I was contacted by the Risk Department telling me it would not be processed because it exceeded my limit, something else I was not informed about. I was told to make adjustments to my account(increase the avg ticket sales) and try again. My customer paid by check and I did not try to process again. 2 weeks later my customer complained about a charge on their credit card. I apologized and called the bank to release the authorization. It was not an authorization, Innovative Merchant Solutions had processed the transaction and had taken the money from the credit card, kept it in their account although they had denied me the transaction and did not put the money into my account. I called to complain and they told me I had to process a return to reimburse the customer. I couldn't believe I was supposed to run a return for something they rejected! I ran a return immediately so that the customer could have their money back, It took another 12 days for them to receive it and I was charged $194.52 for the process/charge.

I called my bank and they reversed the charges because they were unauthorized. At which point Innovative Merchant Solutions closed my account(according to their discretion) and charged me a $295.00 termination fee. After terminating my account they continued to take $10.95 out of my account for two months. They have now sent me a letter stating I owe over $600.00 and threatening litagation and all expenses included with it within 10 days. All of this nonsense and they have never processed one credit card charge for me! Their operation is a complete rip-off and not consumer friendly business! Also to mention, Customer service reps are Hostile and Agressive!

I would like to know how to get on board for the Class Action Lawsuit, This way of business has to be stopped!

They are numerous other complaints from consumers online also interested in stopping them.

I am also filing a complaint online with the BBB, they have a grading system and I am sure if they receive everyones complaint there as well their rating will decrease.

Let me know how to proceed! Thanks! Chelsea

 CLICK here to see why Rip-off Report, as a matter of policy, deleted either a phone number, link or e-mail address from this Report.

Mike,

Now you see what I mean by "deceptive" on the part of IMS. This is why I am going after these guys. Even if the amount was $10, I would still be ticked off for them not disclosing the amount and for it to not happen again to another business. I will take your advice and forward it on to my attorney and look into the actual underwriting processor.

Robert,

I was actually considering small claims court as it is actually simple to start the process in California. However, after consulting with my attorney, he felt that in order for true "change" happen so that it won't happen again, a class action may be in order so that all parties that have been affected by this would get a settlement AND the contract language changed. That is the true purpose of doing this. So that another business owner won't get screwed by this deceptive tactic.

Thanks for the rebuttals guys!

TCS, I would have to agree with Robert. This is probably the ceapest avenue as well.

I would recommend you sue them in small claims court. Since both you and they are in CA this should be rather simple for you to accomplish.

A class action takes years to successfully accomplish and when it's over and done you get a coupon for 15% off your next purchase/service agreement.

Also, it is very UNLIKELY that this "standard termination fee" goes to the service underwriters-it likely goes into their own pocket. This is how they make their money. Either way, they get a fee; $395 for early (6 months or less) termination and $295 for ALL OTHER terminations.

Seems to me you should sue them in small claims court. You seem to have more than enough on your side for this to be a slam dunk win for you. I suspect that shortly after you file a small claims suit, they will send you a refund - DON'T accept it UNLESS it includes the filing fees for small claims court.

What I would do is offer them a pay me now or pay me MORE later scenario. I would send them a certified, return receipt requested letter damanding payment of this fee (the courts will require proof of demand of payment.) I would clearly indicate in this letter that if $295 is not received by XXXXXXX date, that you will file a small claims suit against them and that after you have filed the claim, you will not accept any settlement that does not include the orginal amount PLUS court costs for filing the claim.

Good luck.

Innovative is very vague and does not list who the underwriting bank is. I have seen one of their statements and it looks like a First Data generated billing. I would contact your bank and have them do a trace on the ACH deposit or fee that comes from these folks to your account. It is the actual info that comes with the deposit or charge to your account from these folks. They will tell you who is actually funding your transactions and give you an 800 number to contact them. When you get this share it with your co complainant's and slam these people with calls! Show them the VERY deceptive and vague information that Innovative has on their site as well as what they gave you. I would think that if Innovative gets enough feedback and questions from their acquirer about these issues that they will take care of you since they don't want problems with the way their transactions are running. I looked at their site and it is very vague and misleading. Their terms and conditions are almost non existent! Innovative makes the claim that you cannot use your current merchant account to process through your Quickbooks. This is nothing more than a bold faced lie! Most acquirers support the Quickbooks platform. Remember, the actual acquirer that Innovative uses is who you should go to and complain to as Innovative will take there calls very seriously. Good luck!

You would have to see the contract. The part that is illegal and deceptive is that they FORCE you to either get a mailed copy of the COMPLETE Merchant Agreement in order for you to get EVERY DETAIL or for you to read the agreement ONLINE. The mailed copy would take 3-5 business days to get and if you do not have access to a computer to read it online, you are essentially screwed. AGAIN: The part that is ILLEGAL is the fact that they HIDE the Standard Termination Fee amount from the Merchant Agreement they send to you. In order to see this amount, they force you to use only those two methods to find it. PERIOD. END OF STORY. California Law states that if you disclose one fee, you must disclose them all in a clear manner. The Merchant Agreement shows the Early Termination Fee as clear as day and HIDES in non descript language the "Standard Termination Fee".

Word for word the agreement states:

EARLY TERMINATION FEE: Only sign this application if you are applying for NEW credit card processing with IMS. If Merchant is approved and elects not to process with IMS and/or cancels the account within six (6) months of approval, Merchant will be charged a $395.00 cancellation fee to offset IMS's costs of setting up Merchant's account. If cancellation and/or termination of the Merchant Agreement occurs after six (6) months, Merchant will be charged the standard termination fee.

Read the LAST LINE. There is NO SPECIFIC FEE listed. The termination fee could literally be ANYTHING. Period. Based on California law, if they list one fee, they MUST list them all. This is a tactic used to trick unsuspecting people as they KNOW that the majority or people will NOT wait for the mailed copy OR go online. If they disclose this fee, most people would look for a better processor with lower or no fees. This is the part that is illegal and unethical and this is where they are violating the California Business and Professions Code.

UPDATE: I have already been contacted by eight business owners and have forwarded your information to my attorney. If there are any other owners that have been misled by IMS, please contact me via my e-mail address and I will have my attorney contact you.

Thank You

TCS Yes, I am a regular Joe. As a matter of fact I work for one of the big 4 banks and do KNOW what I am talking about. And, YES I READ EVERY AGREEMENT I SIGN! I have the luxury of being able to have my contracts read for free by a legal department when I have questions. TCS, your provider IMS contracts out to one of the big network processors (First Data/JP Chase/NOVA/Global) to underwrite your transactions! THEY ARE THE ONES WHO ACTUALLY OWN YOUR CONTRACT!

Look on you agreement and it should say who IMS is a registered ISO independent sales organization) for! I would direct all of your communications to these people. Or better yet call IMS and ask them who they are with. Don't tell them you are a upset client. When you find out call that organization and ask them who to talk to about a agent dispute! The fact of the matter is that the agreement you signed probably had a section that was double sided that listed all of this language and since you did everything via fax you were not provided this information. As for a class on termination fees I really don't think you have a chance since they are a part of every day business in the banking world.

Based on what you wrote, you are TOTALLY missing the point Mike from Arizona. I guess by not putting anything about IMS in your profile you must be a regular Joe. This is what Mike wrote:

You did not read the merchant agreement. And if you did not have a hard copy in front of you that is your fault period! Would you sign a mortgage loan via the internet? Yes you were misled, but you need to take some of the responsibility here for not reading what you were signing! You cannot blame it on high pressure when all you had to do is say NO!


My response to that is twofold:

ONE - There is NOTHING on the Merchant Agreement that states a 2-3 year contract so I don't know how you got that impression unless you made that up. With IMS, you could be a customer for 1 year to 1,000 years and it wouldn't make a difference.... you would still have to pay SOMETHING (in this case $295.00) no matter how long you were with them (which is ridicluous).

TWO - I DID read the merchant agreement as most people would when under the gun. Do you HONESTLY thing that you read EVERY SENTENCE on a Car or Home document when at a Real Estate or Auto Dealership office??? If you say you do, you are lying and would be at the office for hours or even the better part of a day if not longer. I scanned over the document very quickly looking for major things and with a sales executive over the phone said OK sign me up to get the ball rolling. The Unfair Business Practice question comes into play when the actual Merchant Agreement omitted the actual price of the "Standard Termination Fee" when they listed the amount of an "Early Termination Fee" just a sentence before it. Why list a ETF fee of $395.00 and NOT the $295.00 STF fee a sentence later instead of MAKING THE CUSTOMER have to go to a secondary source???? Based on California Law, that is illegal and deceptive.

"IMS engaged in an unfair business practice towards me in violation of the California Business and Professions Code. There is no reason for Innovative Merchant Solutions to NOT indicate the termination fee within its merchant application when you state the early cancellation fee." This was straight from my attorney words, not mine.

If anyone would like to contact me about a possible class action lawsuit for all the "mischevious" activities that IMS has been doing, based on all the complaints I have been reading on RipOffReport, I have an attorney on retainer that will take the case. I have already contacted the California Attorney General's office, my local news radio station and filed a negative report with the Better Business Bureau. If they think that I am letting them get away with this, they are sorely mistaken. Please put down your name, phone number and what IMS did to you in the E-Mail and I will forward this on to my attorney.

Thanks

You did not read the merchant agreement. And if you did not have a hard copy in front of you that is your fault period! Would you sign a mortgage loan via the internet? Yes you were misled, but you need to take some of the responsibility here for not reading what you were signing! You cannot blame it on high pressure when all you had to do is say NO!

You did not read the merchant agreement. And if you did not have a hard copy in front of you that is your fault period! Would you sign a mortgage loan via the internet? Yes you were misled, but you need to take some of the responsibility here for not reading what you were signing! You cannot blame it on high pressure when all you had to do is say NO!

You did not read the merchant agreement. And if you did not have a hard copy in front of you that is your fault period! Would you sign a mortgage loan via the internet? Yes you were misled, but you need to take some of the responsibility here for not reading what you were signing! You cannot blame it on high pressure when all you had to do is say NO!

You did not read the merchant agreement. And if you did not have a hard copy in front of you that is your fault period! Would you sign a mortgage loan via the internet? Yes you were misled, but you need to take some of the responsibility here for not reading what you were signing! You cannot blame it on high pressure when all you had to do is say NO!