W+ affiliate PP chargeback loop hole?

by Soren
22 replies
I had my first "refund" (or not really a refund but...) ever as a vendor, and it got me thinking...

In my case it's coming from a kind of suspicious affiliate through the w+ platform. I say suspicious because he has no profile here on the forum, he has had 1 sale in 1 hop which equals to an EPC of $47.

Today I heard from paypal that this guy attempts a chargeback claiming someone else had made an "unauthorized purchase" using their PayPal account.

I have absolutely NO problem what so ever, giving a client a full refund (luckily I haven't seen a refund yet, before this one), but this one is a bit problematic, since it's an affiliate who speculated in the following (it seems).

1) w+ affiliate signs up
2) buys through own affiliate link
3) contacts paypal, claiming it was someone else who bought from their paypal account

Paypal then contacts me, telling me they're investigating the process and has set the payment 'on hold'. They say I need to make a decision, but I only have 3 options:

- I don't want to spend time and effort proving the guy was indded the same, and just wanted access to my membership materials, his money back and a free product. I don't want to do this, since it's waste of my time, and I want a guy like that out of my system anyways.

- On the other hand I can choose to take responsibility and give him his money back. I really want to do this, but I do have 1 convern and thing that - in this case - annoys me and keeps me from doing that (therefore writing this post instead).

The problem is that he earned a $11.whatever commission when I bought through his own affiliate link in the w+ system. when I then look up the sale info in w+ and push the "refund" button, nothing happens.

I've heard that the w+ affiliate needs to approve the refund, and that the vendor doesn not exclusively controls this, which worries me a bit...

Because obviously this affiliate has an interest in using this "loop hole", and since I can't refund through the w+, without a "refund request" being made in that system, because he made a paypal chargeback - it looks like he can bank the $11 affiliate commission every time he does this.

It annoys me he can get away with this, but I've pushed the refund button several times in w+ - nothing happens (a pop up does come up, stating that the refund should appear in minutes in the stats, but no...). The other ones do turn red (block, blacklist etc).

Have any of you experienced this? I've wasted most of today, trying to go back and see what I could possibly have missed, - not because of the money (it's only $11 bucks), not because I don't happily give refunds with no questions asked (should I ever get any)... but if I explained myself I guess you can see and agree that this shouldn't be possible.
#affiliate #chargeback #hole #loop
  • Profile picture of the author Alex Blades
    You MUST NOT approve people you don't know, you are only setting yourself up to be scammed.
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    • Profile picture of the author Soren
      Originally Posted by Alex Blades View Post

      You MUST not approve people you don't know, you are only setting yourself up to be scammed.
      I realize that was quite stupid of me, yes, but it makes no sense that I as the vendor, don't have FULL control over whether or not I want to refund a client - even if that client didn't file a refund request through w+.

      I'm getting so tired of this that I'm probably just going to give in and do what he knew I'd eventually do from the start... give him the $11 bucks and refund him on paypal (which was the purpose and "clever" thing about the scam... it's only thing I can do really, without taking this to court heh..).
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  • Profile picture of the author Warrior X
    As much as it sucks to lose the $11, you may have got this lesson cheaply.
    Some have lost much more to affiliate scams like this. The moral of the story
    is only ever approve affiliates who have a reputation here on the forum.
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    • Profile picture of the author Soren
      Originally Posted by Warrior X View Post

      As much as it sucks to lose the $11, you may have got this lesson cheaply.
      Some have lost much more to affiliate scams like this. The moral of the story
      is only ever approve affiliates who have a reputation here on the forum.
      I totally agree with you man.

      But the thing I want to highlight from my experience, is that there is NO good reason as to why they should get away with a scam like that.

      We can never avoid someone buys our stuff, refunds and get our products for free. That's life, and that will ALWAYS happen if you have a good product.

      But why don't you as the vendor have complete 100% FULL control over whether or not you want to refund a client? Why do the affiliate get the last word? Why HUH...? Doesn't make sense at all, and is the root to the entire problem ...

      .. except from the fact that I was stupid as hell, and have approved a ton of affiliates without profiles and people I don't know. I wasn't aware of this "glitch" in the system, which I think it is!
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  • Profile picture of the author Alex Blades
    don't have FULL control over whether or not I want to refund a client
    You signed that away when you decided to use their service, aside from gaining affiliates I see no real benefits to use 3rd party processors.
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    • Profile picture of the author travlinguy
      Originally Posted by Alex Blades View Post

      You signed that away when you decided to use their service, aside from gaining affiliates I see no real benefits to use 3rd party processors.
      I won't speak for the OP but I believe he means the affiliate, needs to also relinquish his share of the sale.
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  • Profile picture of the author Warrior X
    But why don't you as the vendor have complete 100% FULL control over whether or not you want to refund a client? Why do the affiliate get the last word? Why HUH...? Doesn't make sense at all, and is the root to the entire problem ...
    You do (more or less). But chargebacks are a different matter. And scammers
    know chargeback rules favor the buyer and they exploit that to their
    advantage.
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    • Profile picture of the author Soren
      Originally Posted by Warrior X View Post

      You do (more or less). But chargebacks are a different matter. And scammers
      know chargeback rules favor the buyer and they exploit that to their
      advantage.
      But if I could go into w+ and the refund buttons actually worked like it should (refund that client without requesting acceptance from the affiliate (scammer) or without the customer filed a refund request in their system)..if I as the vendor could decide, I could use the 3rd option in the chargeback request on Paypal... I could then say I had already refunded the client, and just give and id to the refund that had been processed.
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      • Profile picture of the author Warrior X
        Originally Posted by Soren View Post

        But if I could go into w+ and the refund buttons actually worked like it should (refund that client without requesting acceptance from the affiliate (scammer) or without the customer filed a refund request in their system)..if I as the vendor could decide, I could use the 3rd option in the chargeback request on Paypal... I could then say I had already refunded the client, and just give and id to the refund that had been processed.
        You're right of course, I would be nice if sellers where completely protected from stuff like that. Anyway don't let it sour you on affiliates in general. I've sold 1000s of wso and never had a problem
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  • Profile picture of the author Alex Blades
    (refund that client without requesting acceptance from the affiliate (scammer)
    I didn't even know you need approval from the affiliate to do a refund, that is a loophole

    You just need to protect yourself by not approving people you don't know, and build your own list of affiliates so you don't have to use platforms like that.
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    • Profile picture of the author Soren
      Originally Posted by Alex Blades View Post

      You just need to protect yourself by not approving people you don't know, and build your own list of affiliates so you don't have to use platforms like that.
      I feel like a newbie, but I've definitely learnt that lesson now, although it makes it very easy to pay JV partners, which is cool.
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      • Profile picture of the author Alex Blades
        Originally Posted by Soren View Post

        I feel like a newbie, but I've definitely learnt that lesson now, although it makes it very easy to pay JV partners, which is cool.
        No need to feel like a newbie, you can't control what is not yours, plus like warrior x said, you got off cheap.
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        " I knew that if I failed, I wouldn't regret that.
        But I knew the one thing I might regret is not ever having tried. "

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      • Profile picture of the author barry500
        Maybe I am missing the point but in the larger world of affiliate marketing be it through paypal, clickbank jvzoo etc. What is stop this activity?

        If an affiliate signs up and then uses numerous accounts to buy the same product and subsequently claim a refund, does he (the affiliate) always have to payback commissions earned if it turns into a refund?

        If not he could earn up to 75% commission and then take refund!!

        Although I appreciate that it is best to know affiliates it is hard to believe that the big selling warriors on this forum have a personal relationship with every affiliate? Perhaps someone could clarify.
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    • Profile picture of the author travlinguy
      Originally Posted by Alex Blades View Post

      I didn't even know you need approval from the affiliate to do a refund, that is a loophole

      You just need to protect yourself by not approving people you don't know, and build your own list of affiliates so you don't have to use platforms like that.
      You don't need approval. Since the affiliate received money, any refund requires that s/he also refunds their share of the sale. I've never had to deal with one where the affiliate bought a product for himself and requested a refund. It should be interesting to see how this goes.
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      • Profile picture of the author Alex Blades
        Originally Posted by travlinguy View Post

        You don't need approval. Since the affiliate received money, any refund requires that s/he also refunds their share of the sale. I've never had to deal with one where the affiliate bought a product for himself and requested a refund. It should be interesting to see how this goes.

        Ah ok, I thought WP had the option to refund the buyer from both the seller and affiliate's account.
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        " I knew that if I failed, I wouldn't regret that.
        But I knew the one thing I might regret is not ever having tried. "

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        • Profile picture of the author Soren
          Originally Posted by Alex Blades View Post

          Ah ok, I thought WP had the option to refund the buyer from both the seller and affiliate's account.
          Okay now I'm confused. What do you mean?

          I know one thing.. nothing happens when I do hit the refund button for the specific sale. It is kind of misleading because a pop up does come up, in which there's a text stating that the refund has been processed and should be visible from the stats in a few minutes..

          I can hit the buttons and watch that funny text as many times as I want, nothing happens.. which makes be believe the rumors were true - that the affiliate has the last word.. Either way, I don't get to decide whether or not I want to refund a sale.
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        • Profile picture of the author travlinguy
          Originally Posted by Alex Blades View Post

          Ah ok, I thought WP had the option to refund the buyer from both the seller and affiliate's account.
          Not that I'm aware of. Think of it. That would mean W+ would have access to the affiliate's Paypal account because that's the only way a refund can be issued, via the recipient's PP account.
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          • Profile picture of the author Alex Blades
            Originally Posted by travlinguy View Post

            Not that I'm aware of. Think of it. That would mean W+ would have access to the affiliate's Paypal account because that's the only way a refund can be issued, via the recipient's PP account.
            They should require it, just like they do the seller.
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            " I knew that if I failed, I wouldn't regret that.
            But I knew the one thing I might regret is not ever having tried. "

            ~ Jeff Bezos

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          • Profile picture of the author Soren
            Originally Posted by travlinguy View Post

            Not that I'm aware of. Think of it. That would mean W+ would have access to the affiliate's Paypal account because that's the only way a refund can be issued, via the recipient's PP account.
            From a developers point of view that wouldn't be hard. PayPal has an API for full integration with their system.
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            • Profile picture of the author travlinguy
              Originally Posted by Soren View Post

              From a developers point of view that wouldn't be hard. PayPal has an API for full integration with their system.
              I don't doubt it wouldn't be hard. I know this though, I would NEVER give some third party provider access to my account for any reason. That would make them the judge, jury and the executioner. And I'm sure most don't want that responsibility.
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  • Profile picture of the author sbucciarel
    Banned
    This is a problem on all the instant commission affiliate platforms.

    Don't approve people you don't know and if you use JVZoo, use delayed payment and don't pay them for 45 days, unless you absolutely know them and trust them.

    http://www.warriorforum.com/main-int...maybe-not.html
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  • Profile picture of the author Robert Michael
    With JVZoo, when the vendor refunds a sale it automatically refunds the affiliate commissions too.

    It takes it out of their PayPal account & sends it back, along with your share.

    Might want to switch over to them.
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