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Comment by kozak | Hacker News Reader

I recently traveled to the US, and stayed in a hotel of a major brand which had some outdated payment terminal that only used the magnetic strip of the card (without even a possibility to enter the PIN). The transaction was over a thousand USD. I had cards from two different banks: one failed because the PIN wasn't entered, and the second one got through. But after several months the second bank somehow freaked out and charged back about a third of the amount (probably flagging the transaction as fishy or something). I tried to contact the hotel to somehow return them the money that were mistakenly returned to me, but apparently there is no mechanism to do that.

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To be fair, they're the ones that don't know how to conduct business transactions in the 21st century. Consider that they just paid a "you had better update your system" tax.

To be fair, there are vast swaths of America, larger than some European nations, where credit card transactions are necessarily done on carbon paper with the old imprinting machines. I was at a hotel that did it just last week.

Updating your POS system to chip-and-PIN doesn't help if there's no infrastructure (or reliable infrastructure) to plug it in to.

Why are they "necessarily done on carbon paper"? You would be hard-pressed to find locations in the US, where credit card holders generally wander, where there is no inet access..

I assume they're referring to national parks, Alaska, and so on.

Yellowstone is the size of Cyprus, and Death Valley is the size of Montenegro, to use two examples without much internet access. Alaska is three times the size of the Iberian peninsula and most of it does not have internet (though to be fair most of it has no population or tourism).

Satellite internet is cheap enough that I'd consider the only good excuse to be a complete lack of power. And even that is becoming less true as solar drops in price.

I live near the Adirondack mountains in New York, where internet access is still dial-up or satellite. In most places populated enough to have stores, however, there is 3G cell service and that allows for wireless POS terminals and ATMs.

The places I've seen either use that or accept cash only.

> some outdated payment terminal that only used the magnetic strip of the card

Sadly, this isn't all that "outdated" here. There are still lots of places in the U.S. that don't use the chip and basically none -- does anywhere? -- use a PIN with it. I don't even know if I have a PIN on any of my credit cards, much less what it is.

Your issuer can use a PIN in the US - my credit card through my credit union uses a PIN, which confuses the hell out of most clerks. Sometimes I have to walk around the counter to reach their machine and enter the PIN, sometimes they have me sign the receipt (just at the bottom, since it doesn't print a signature line) so they feel better.

I think Barclaycard is the only major CC issuer in the US to have actual PINs on their cards but it defaults to signature. Here's what they say about it:

>Your credit card is a chip and signature card with Personal Identification Number (PIN) capability. In most cases when you travel abroad, you'll be asked to sign for your transaction. However, at some unattended terminals, such as train ticket kiosks, you may be asked to enter your PIN instead of signing.

I applaud your sense of fairness -- wanting to pay the hotel for the chargeback.

But on the plus side, maybe it will motivate the hotel to implement a more secure payment system?

In addition to fairness, I also don't want to get on some anti-fraud black list, because it might look to them like I used their services and then avoided fully paying for them. And they have all my identity information (passport number, etc). It's a convenient hotel in which I may need to stay again in future, and I don't want to look like a fraudster in their CRM system.

Can a consumer even initiate a partial chargeback on their card without the original merchant being involved? I don't think they can, so you probably have nothing to worry about as far as fraud lists or something.

edit: Didn't see other reply

They did a partial refund specifically for fraud? Not the whole amount? That is extremely strange.

I'm not sure what was the reason of the refund. It was a mistake of some kind. From what information I could get from the bank, they were trying to charge back the entire sum, but somehow got only part of it.

Maybe exchange rate movements? If you paid in USD the chargeback will only work for the USD amount which could be less at the time of the chargeback. If your card is in GBP and it was in 2016, a difference of 20-30% is easy to explain.

Doesn't look like that because exchange rate fluctuation was about 5%. I think it was some human factor issue - "hey, look at this screamingly insecure transaction for a large sum of money, it can't be right". The chargeback was initiated on my behalf, but they don't have any records of me requesting it. Basically, their response is something like "yes, we screwed up, but at least we screwed up in your favor, why should you worry".

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