Visa Shuts Off Credit Card Processing to Web Scammers

Consumers tricked by false advertisements for weight loss regimens and teeth whiteners received some unexpected intervention from one of the world's largest credit card service providers. Officials from Visa made the unusual move to shut down payment processing services to one hundred marketing companies found to have violated their merchant agreements. Many of the affected companies used "free trial" agreements that included large monthly, recurring credit card charges.

Typically, a merchant bank reviews its records for chargebacks and complaints against client companies before issuing warnings or restricting credit card processing privileges. The companies involved in Visa's investigation ignored consumers' requests to cancel recurring charges, prompting numerous complaints to local law enforcement officials and to Better Business Bureau chapters. In response, Visa escalated the usual process of closing down merchant access to its payment platform and suspending funds in transit.

Visa's actions signal a more aggressive approach to curtailing online credit card abuse. Although marketers involved in the "negative option" service business state that their companies operate legally, Visa officials told reporters that the perception of repeated unfairness among merchants can trigger suspension from its payment processing platform.