Merchant Warehouse - First Data - Aida Marr - Anthony Latino Merchant Warehouse along with their counterpart First Data siezed over $67,000 and crippled my small family owed business Boston Massachusetts

It sounds like you have a seasonal business where maybe some months you might do a couple thousand bucks and other months might be $50K. If you were approved to do $5000/mo and you run a $50K month, you might have exceeded what First Data detemined was your ability to personally cover losses in the event your business closed and left customers wanting their money back.

There are ways to avoid a reserve account situation...

1) Choose a payment processor with enough capital of its own that it can sustain and support its own risk. And ensure it is owned by a respected bank that is also known to be strong. For example, Elavon (formerly Nova) does a couple hundred billion in transaction revenue each year and is owned by US Bank which is one of the strongest banks in the world (no sub-prime or derivative asset issues like other banks did).

2) Ensure that when you are approved, you know what your parameters are. What is the highest sale they are allowing and what is the monthly cap on your volume.

3) Find out what the steps are you would need to take to increase those caps in the event your business either had a once-in-a-lifetime individual sale of, say $10,000 if your average sale is typically $100, or if your business suddenly skyrockets. Usually you just need to call customer service and advise them of the new situation so they can re-underwrite the account and give you more room.

If you change the type of business, product offerings, customer type (wholesale B2B vs retail), structure, or other material change to the original basis for your account approval and don't advise the other party to your contract, you've violated your terms of service by not keeping everyone on the same page and you've placed yourself, your customers, your processor, and at least 2 banks in the position of seeing heavy potential losses. That is the ONLY reason why a processor would follow the guidlines set forth by the associations for risk management by withholding funds until it can be determined the risk of losses is alleviated.

I just received my first official notice from first data since they seized my money (67,879.83) on March 5, 2009. It is dated March 24, 2009. As I stated in my original report they made us jump through hoops (like faxing 90 pages of documents after faxing me 3 pieces of paper that had 127 transactions that I was required to find the customer's information by their credit card numbers..pull their files and fax it back to them. They were arranged on their end by highest amounts charged to lowest...not by dates, and no names to go by...127 transactions. I did all this (it took 3 days to sort it out) and when I went to fax the 90 pages, Ada Marr the representitive "was on vacation". So it went to someone named Daniel Cortez to play with till she got back. Anyway, my new letter states that I am terminated and my money will be put in a "reserve" account that will be held to secure "the trailing obligations that you have to fund chargebacks and other items that MAY occur." My company as I stated had 1 chargeback in a years time and it got resolved happily. The letter ends with " it should be held for a period of less than 10 months". I ask anyone out there....is this legal? This to me is blantant thievery...how can this happen...these people have destroyed everything we have worked for...what kind of lesson does this send to my son's about their future? By the way, verbally they were holding my money for 6 mos. now in writing it has grown to 10 months. What else can they do to us?