A Terminated Merchant File listing occurs when a business, consumer, or merchant does not honor their credit service agreement with the processor / bank. Some ways of not honoring their agreement are:
- Excessive charge backs (#1 reason to be placed on a Terminated Merchant File)
- Credit card fraud
- Deposited sales by the merchant, which was not authorized by their seller
- In-depth audit concludes that the merchant is involved with excessive fraudulent activities
- The acquirer views the processor has being in violation of their agreement
- An exorbitant number of counterfeit sales were deposited by the merchant
- The acquirer learns from a third party, such as VISA or Mastercard that merchant is heavily involved in fraudulent activities
Is there a way for me to get off the Terminated Merchant File List / Match List, or are there dark days ahead?
The key here is whether or not your business was erroneously put on here or not. If it was put on the Terminated Merchant File erroneously than you have a chance. You must follow up with the company that put you on the list and have them remove your name. Only the acquirer/bank can remove you from the list. Getting in contact with an attorney who specializes in this may be of great benefit, since they know the business very well. Dealing with the likes of VISA and Mastercard is for the experts, not the amateurs. If your business was placed on the list erroneously it is likely due to an incorrect TID, address, or business name.
Having my business put on the Terminated Merchant File seems somewhat unethical or unfair.
This process is very similar to personally being put on a bad credit report. The bank must make sure they do their due diligence before they put your business or personal name on the TMF. They also have a duty to report your account to the rest of the acquirers, about you and your business. So it works both ways they must play neighborhood watch dog, but not bite the person before they see if he is a perp of not.The likelihood of your business being put on the Terminated Merchant File List incorrectly is slim, because A Visa member who fails to comply with listing requirements could be held liable for the losses incurred by another acquiring bank for failure to list; whereas, VISA and other card organizations ensure the bank/acquirer indemnify them for all claims from its incorrect addition or deletion, or failure to remove from the Terminated Merchant File list when required.
What would be your advice for avoiding the Terminated Merchant File List / TMF?
This pretty simple. Stop doing fraudulent activities! If things start to occur that could be considered fraudulent you should be in close contact with your bank. Some guidelines are:
- Stay within your maximum ticket, unless you have gotten consent from the bank
- Make sure your customers can always get a hold of you
- Be in business for the marathon, not the sprint