On a trip to Izmir, Turkey, last November, Kathy Worley spent nearly $3,000 for a silk rug. At least she thought she was buying a silk rug.
After returning home, a conversation with a retired Turkish rug merchant led her to believe she may have been misled about the rug’s authenticity. “He said that a ‘Silk on Silk’ rug was many of thousands of dollars and recommended getting an appraisal,” said Worley. She did, only to learn it was a fake.
Upset, Worley emailed the merchant in Turkey, stating that she wanted to return the rug. The merchant didn’t respond.
Next, she enlisted the help of her credit card company. She disputed the purchase and was given a temporary credit. Over a month went by before she received a letter from her card issuer stating that the merchant was disputing the chargeback because the rug had not been returned. It cost Worley nearly $300 to send it back via FedEx, and the merchant refused to pick it up.
Shortly after that, she received a letter from her card issuer stating:
…We are sorry that this is one of the few instances in which we cannot assist you. Please allow us the opportunity to explain more fully.
Due to the fact that this was a face-to-face transaction, you had the opportunity to inspect the merchandise before leaving the establishment with the purchased item. And since we have not been provided with a credit receipt or a valid second opinion or any documents stating that what was purchased differs from what was on the merchants invoice as requested; our further dispute rights have been negated. If you should continue to dispute the transaction, we can only suggest that you contact the merchant directly to obtain a favorable resolution.
We have rebilled your account for this amount. This charge adjustment will reflect on your next statement. Your understanding is appreciated.”
Not The First Time…
Worley reached out to us at Credit.com, asking for advice. Her situation immediately brought to mind another consumer I had helped years ago. He had purchased a “marble” statute in Italy. It was chipped during shipping, and he discovered it was really alabaster. He also got the runaround from his card issuer when he tried to dispute the charge, but we were eventually able to help him get a refund.
How? The consumer in question, just like Worley, had written documentation from the merchant describing the item in detail. When it turned out that the merchant had sold him something different than what he was told he was purchasing, he was able to exercise his rights under the Fair Credit Billing Act (FCBA) to assert a billing error.
The FCBA is a powerful federal law that gives consumers the right to dispute billing errors on credit card statements. It does not apply to debit or prepaid cards. Errors include:
A reflection on a statement of goods or services not accepted by the obligor or his designee or not delivered to the obligor or his designee in accordance with the agreement made at the time of a transaction.
Does that mean that as long as you purchase something using a credit card you’re guaranteed a refund? Not quite. Worley had received a certificate of origin and content from the merchant stating the rug was pure silk. Without that, it would be her word against theirs.
If you’re planning on buying an expensive item when traveling -- especially from some place faraway where it may be difficult to return the item -- you’ll want to take the following precautions:
Ask the merchant about its return policies. Do not assume that an item is returnable. Practices in the country you visit may be very different than what you are used to in the U.S. If the merchant tells you it accepts returns, make sure you get that in writing. The same thing applies for return shipping charges: get them in writing.
Get a detailed receipt and keep it in a safe place. If you purchase more than one item but the receipt lists only a total, get an itemized receipt signed by the merchant.
Get an appraisal. If you are buying something unique or expensive (think jewelry or artwork, for example), get an appraisal from an independent third-party before you buy. If that’s not possible, make sure you at least get detailed information about the item in writing, signed by the merchant. The Fair Credit Billing Act won’t protect you if something is worth less than the price you paid for it. But it may protect you if the item turns out to be substantially different than what the merchant represents. As Worley’s case illustrates, however, even that may not be a slam dunk.
Don’t forfeit your purchase. Make sure you find out whether you will be able to legally bring the item back to the U.S. once you purchase it. Some items cannot be imported into the U.S. or your state and you won’t get a refund -- even from your credit card company -- if those items are confiscated. Even worse, you could be fined. The U.S. Customs brochure, Know Before You Go, provides information on restricted or prohibited items.
Find out whether you will have to pay duty. Some items are duty-free or may qualify under an exemption. But in some cases, including countries where a 100% duty is imposed, you could wind up paying as much in duty as the purchase price! You’ll find details in Know Before You Go.
Get shipping details in writing and buy insurance if possible. Again, try to protect yourself by getting as many details in writing as possible. If a third-party other than the merchant is shipping the item, make sure you know where to complain or return the item if it is damaged during transit.
Choose your credit card carefully. Some cards assess foreign transaction fees of 2-3% of the purchase amount. While paying by credit card is the safest way to buy something overseas, that fee can be steep on a large purchase.
If you have purchased something overseas that you believe is a fake or has been significantly misrepresented, act quickly. Under the FCBA, you have 60 days (from the state the statement listing the charge was mailed to you) to dispute the charge. You can call the issuer to ask for details on how to dispute the charge properly, but always put your dispute in writing and send it certified mail, return receipt requested to the address on your statement for billing errors and inquiries. The issuer has up to two billing cycles to investigate your dispute. In the meantime, you can withhold payment only on the amount under dispute. Pay the rest of your bill or at least make minimum payments.
Worley’s situation had a (fairly) happy ending. We were able to put her in touch with someone at her card issuer who finally issued a refund. But she’s out the $290 she paid to ship the rug back. Still, she knows it could have been a lot worse. After sharing news of her refund with me, she added,”I hope you still write about the dangers of shopping (overseas).”