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An overseas merchant whom I have purchased from before made an erroneous transaction on my credit card bill. The dispute has been resolved and the money refunded. The problem is incurred currency losses as a result of the currency conversion losses. It amounted to a total of 6% of the transacted amount. I could buy several lunches with the loss.

Imagine if an overseas merchant were to make a wrong transaction of USD10k, then refund the amount, the currency conversion losses would amount to USD600. It is also not uncommon for some merchants to charge twice by mistake. I have heard of that happening in hotels when the staff is new and inexperienced.

I have contacted the merchant. They have yet to respond. I wonder what else can I do if the merchant stubbornly refuse to do anything.

What protection do credit card consumers have when this happens to them? Do we have to suck it up?

The credit card is issued in Singapore and the merchant is from the United States.

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    I highly doubt you have any recourse here, but would call the credit card bank. To some extent this is a risk you run with foreign transactions. – quid Oct 18 '17 at 1:19
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    @quid, this is a big risk to consumers. All of us are vulnerable to careless mistakes by overseas merchants. If the mistake is a 5-digit figure, the currency losses will be substantial. – curious Oct 18 '17 at 1:24
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    it could have been a currency win though. – quid Oct 18 '17 at 1:30
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    @quid, it will always be a loss because the charges came from the bank who charged us an arm and a leg for conversion. – curious Oct 18 '17 at 1:30
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    @curious, I agree with quid - if the exchange rate had swung the other way, you still could have come ahead do to favorable exchange rates. I've had that experience myself, where I booked something (prepaid a deposit) and then the landlord canceled the booking/refunded the deposit - I came out a few dollars ahead in the exchange. – JW8 Oct 18 '17 at 3:44
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What protection do credit card consumers have when this happens to them? Do we have to suck it up?

If the transaction was without authorization, you have to dispute with your card service provider. The transaction should be nullified. In such cases the merchant gets flagged for unauthorized transaction.

In this case it looks like you have taken a service and then cancelled due to some reason and there is a refund. In case of refunds, Card Companies don't take the risk due to Foreign Exchange.

Related question Exchange gain on credit card refund

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    The credit card company is not at fault. The merchant is at fault. The correct procedure should be to approach the merchant first and if it fails, get a chargeback. – curious Oct 18 '17 at 5:52
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    @curious I disagree there. If it is unauthorized transaction, you should flag it to Card Company. They will reverse the transaction. You don't get hit by exchange profit /loss. Although the merchant may have resolved this faster, the way merchant has done this is refunded. you are hit with profit/loss. That is how the card industry works. On Reversal the Card company [or the merchant] take the hit. On Refund individuals take the hit. – Dheer Oct 18 '17 at 5:55
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    @Dheer. Just noticed OP's original question (What protection do credit card holders have against orders mistakenly placed by merchants?) where it seems they did first contact the bank/CC company and were told to take it up with the merchant... – TripeHound Oct 18 '17 at 7:40
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    @TripeHound Yes Card Companies want it to be resolved between Merchants and Buyers so that they can wash off their hands. In this specific case I would refuse saying I don't know the merchant and don't have anything to do with him. To that extent a card company can't request an individual to chase an unknown company ... it is different if there was a authorization and dispute is related to delivery/quality/not serviced/tips overcharged/duplicate charge etc. However if its a Fraudulent charge, the onus is on Card Issuers. – Dheer Oct 18 '17 at 7:43
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    Note that it could have been a currency gain as well - it depends on how the exchange rate develops. – Aganju Oct 18 '17 at 10:16
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I have contacted the merchant. They have yet to respond. I wonder what else can I do if the merchant stubbornly refuse to do anything.

That is the correct thing to do. You should try to resolve problems like this with the merchant first.

What protection do credit card consumers have when this happens to them? Do we have to suck it up?

No, you don't have to suck it up. The charge was unauthorized and regardless of what the merchant says, you are not required to pay it. Your next step would be to report the unauthorized charge to your credit card company and your unsatisfactory attempt to get the merchant to fully compensate you for the losses that they caused you. They are required to do so.

If someone makes a mistake that causes you to suffer a loss, they are responsible for the full amount of loss they caused. The mistake is their fault, as they conceded, so the exchange losses you suffered as a result of it are also their fault because they flowed directly from it.

Yes, it's bad luck, but that's life. You can throw a rock 100 times and not break a window and you don't owe any money. But if you throw it once and it happens to break a window, you're paying for the window. Sometimes small mistakes have big consequences. Don't like to pay for them? Be more careful.

Update: Let me rebut a comment to this answer as others probably feel the same way:

The merchant has nothing to do with the currency exchange.

False. The merchant initiated the currency exchange by posting the transaction. Merchants know that sometimes they cause currency exchanges and, in this case, they did. The currency exchange was the direct, predictable, and automatic consequence of the merchant's actions. If you make a mistake, you are fully responsible for its direct, foreseeable consequences, whether or not you intended them or were specifically aware they would happen.

All the merchant knows is a charge for $10 was made in error and reversed.

Again, false. He contacted the merchant and told them what happened.

The rest is on the bank and/or card network if at all.

False. The merchant is responsible for any harm that directly flows from their mistake. This is a basic principle of law. If you throw a baseball and it happens to hit a window, you're responsible for the broken window. This is true even if you can often throw a baseball and not break a window or if you didn't immediately know you hit someone's window. The merchant made a mistake, they're responsible for the harm they caused.

Nevermind the obvious jurisdiction issues of actually holding a foreign merchant accountable if the bank/card network won't eat the currency exchange loss.

Fortunately, you don't have to. In pretty much every country, there are already laws that say that bank/card networks can't attempt to enforce an unauthorized charge. The original charge was unauthorized, so it can't make him responsible for any payment.

Your answer almost completely ignores the actual issue of this question.

No, it ignores the attempt to obfuscate the simple facts that the merchant is responsible for the harm they caused and that the bank/card network has no legal authority to enforce a charge that is indisputably unauthorized.

  • The issue at hand is much more complicated than this. The merchant DID refund the money. The issue is the currency exchange loss and whether or not the issuing bank or the credit card network will reimburse that. As an example the merchant accidentally authorized a charge for ~$10, and reversed $10. The issue is the buyer is in another country using a different currency so some currency was changed to dollars and there was an exchange loss between the authorization and the refund. – quid Oct 19 '17 at 0:47
  • @quid That is complete nonsense. The original charge was not authorized. He does not have to pay any money as a result of that original charge. There is nothing else that could obligate him to pay anything at all. The rest is obfuscation on the part of the merchant and/or the bank to try to get him to pay for someone else's mistake. He is under no obligation to pay any money at all as a result of an unauthorized charge. He can ignore it completely. It is very, very simple. – David Schwartz Oct 19 '17 at 4:36
  • The merchant has nothing to do with the currency exchange. All the merchant knows is a charge for $10 was made in error and reversed. The rest is on the bank and/or card network if at all. Nevermind the obvious jurisdiction issues of actually holding a foreign merchant accountable if the bank/card network won't eat the currency exchange loss. Your answer almost completely ignores the actual issue of this question. – quid Oct 19 '17 at 4:57
  • @quid See updates. In every jurisdiction I know of, a card/bank network cannot enforce an unauthorized charge. This charge is indisputably unauthorized. It simply cannot make him responsible for any payment. – David Schwartz Oct 19 '17 at 16:47
  • False. The merchant initiated the currency exchange by posting the transaction. No the merchant didn't. The merchant charged USD. Your card paid USD. Your bank converted some currency for you sometimes for an additional fee. The merchant has nothing to do with the currency exchange. – quid Oct 19 '17 at 19:17

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