Chargeback Laws in Florida

Chargebacks are a big headache for entrepreneurs. Aside from losing money, relationships can also be ruined and credibility may be questioned just because of a single purchase. In fact, too many chargebacks could get you blacklisted. 

But chargebacks are also created by states like Florida to protect the interest of consumers, especially from credit card fraud, scams, and other unlawful acts.

So, whether you’re an entrepreneur or consumer, here are some of the things that you need to know about the chargeback laws in the state of Florida.

Fraudulent Use of Credit Cards

According to Chapter 817 of the 2020 Florida Statutes, “a person who, with intent to defraud the issuer or a person or organization providing money, goods, services, or anything else of value or any other person, uses, for the purpose of obtaining money, goods, services, or anything else of value, a credit card obtained or retained in violation of this part of a credit card which he or she is forged, or who obtains money, goods, services, or anything else of value by representing, without the consent of the cardholder, that he or she is the holder of a specified card or by representing that he or she is the holder of a card and such card has not in fact been issued violates this section.” 

As a consumer, it’s very important to be aware of card skimmers that will scan your card and make a copy of it to use for unauthorized purchases. As a business owner, you have to be vigilant with credit card purchases and ask for identification if you can in order to avoid unknowingly authorizing illegal purchases using stolen credit cards that could result in a chargeback.

Negative Option Scheme

This is one of the most common reasons for chargeback complaints in Florida and other states, and it stems from businesses convincing customers to join a “free trial” without knowing that they would be billed automatically for a recurring monthly fee after that free week or month expires. 

When customers see these charges on their credit card statement, they’re going to file a chargeback complaint instantly. 

Florida chargeback laws actually cover this since the Federal Negative Option Rule states:

“Sellers must clearly and conspicuously disclose certain information including how many selections you must buy, how and when you may cancel your membership, how to notify the seller when you do not choose an item, how postage and handling are charged, and how often you will receive the announcements.” 

The Bottom Line

If you’re a business, it’s very important to know about the chargeback laws in Florida to make sure that you don’t get into trouble and suffer from huge chargeback fees, especially for high-risk merchant accounts. 

Complying will also help you protect your integrity as a business and keep your payment processing account. 

On the other hand, if you’re the consumer, it pays to be more aware of your rights regarding chargebacks to not only save yourself from unwanted or unauthorized purchases but also to protect your personal data from scammers and other risks that could jeopardize your identity.

As a reputable credit card processing company, First Card Payments understands the chargeback laws in Florida and offers chargeback prevention tips for low-risk and high-risk businesses.

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