SquareUp rejected my mom's card, which was not stolen, as a "stolen card"

[MartinN]

Hello all - I did a lot of computer work for my mom's company over the last year and today when I tried to charge for my services via SquareUp, by manually entering all the correct info, CC#, expiration date, CVV and ZIP code - the charge was approved. However, within minutes I received an email asking for more information due to suspicion of fraud - which I provided and then the resolution to my response was to refund my mom's money, instead of allowing me to withdraw it.

SquareUp's explanation was that the card was part of a "stolen credit card scam." I asked my mom if anyone has charged her anything to her card that she did not approve and she said 'no', and that if there was fraud, usually her bank is pretty good at flagging/stopping it.

This was a case of a legitimate transaction that somehow SquareUp has registered as part of a stolen credit card scam. I asked them, how do I get past this - Square's response was for her to get a new CC# and run the charge against that one instead.

Has this happened to anyone else and how could Square possibly know someone's credit card was stolen if the credit card was never reported as stolen or even used for any fraudulent activity?

I was pretty **bleep**ed off but I refunded my mom and wanted to check if I am being singled out here or if this is even possible?

How can Square know a card is stolen when no fraud was ever committed on it nor was the card ever reported as stolen??

Appreciate any explanations. Thank you.

Martin

[Minion]

 Hi  @MartinN 

Welcome to the Square Community.  How long have you been with Square?  I'm assuming that this wasn't your first transaction but maybe the value differed from your "normal" transactions amounts being a year with of work?   I am not sure about if they can tell if I card has been compromised by not being the actual issuer of that card, however they may have been referring to more along the lines of the system flagged it and it as suspicious activity of potentially fraudulent.  Without knowing anything about your account or history with Square, I would be the manual entry part most likely played a large factor in that being flagged.

  I don't believe that they were singling you out, but Square does reserve the right to refuse a payment as per the TOS .  Obviously in your case it wasn't , but when dealing with millions of customers they are trying to protect themselves, the seller and the buyer.   In person payments are best to use the tap/dip feature or send an invoice to your moms company as well for the services that you provided.

[MartinN]

I've been a customer for several years and yes, the value of this particular transaction was significantly more than any other transaction. Previously at most it was in the hundreds, this one was a few thousand. I can understand protecting against genuine fraud - this wasn't it. They f-ed up on a false positive in my case.  They need to fix their fraud detection heuristics.

p.s. my account was not disabled, so in that sense, they were fair

[Minion · Accepted solution]

 I agree the explanation  should have  been labeled more clear 100%.  Aside from that I'm not really seeing any issue.  I think that they were in the right by doing what they did.  Transaction amounts varied largely from your average sale ticket and a manual keyed transaction would be a red flag for any card processing company.  I can understand your frustration, but your account is still open and active and you should be able to send an invoice or use one of the other methods I described above to process the payment for your services.