Upwork asking me for a $12.5k refund as the client was using someone else’s card

I do wonder why the author is still on Upwork, their rating & exposure on there must be worth more to them than working several weeks for free, but personally I'd walk. I also don't understand why the pay back is not pro-rata instead of full time, allowing freelancers in this position to earn some money to pay the bills whilst paying back the chargeback (although they shouldn't be paying it at all). If the author is in the same country as the client then they should also be taking legal action to reclaim the money (which again, Upwork should be doing).

"Let me translate this. Robin has been using someone else’s credit card for two years..." followed by "I’m on very good terms with Robin."

Clearly, 'Robin' is a thief and it is entirely possible that Robin and the freelancer are one and the same. That the freelancer is not asking Robin for the money even though he knows him personally is telling. Does the freelancer wonder what his good client Robin thinks about the fact that Robin ran up a 12K credit card bill(payable to the freelancer, ultimately) that Robin never paid?(And we know the bill was never paid or there would be no need for the claw-back)

And I did not see any mention of where Upwork contacted Robin. Strange considering he was the one with “a credit card connected in his account that wasn’t actually his”. Is he still on the platform?

And then he sent two years worth of work to Upwork to substantiate his claim to the money. But how could Upwork know that the work he sent was legitimately related to the transaction? Could he not have created a project request for something he had already built?

Then he apparently logs ALL of his 'time' outside of the system. He said that this time was for "a brainstorming session and a few meetings" with Robin. 230 hours worth!? I notice that dates of the charge-back transactions were not provided. Was this 230 hours the entirety of the project or just a very small slice. He wrote that he had made more that 100K on Upwork and that he had other clients. That leads me to think that this 12K represented all or most of the billing on Robin's project. Was there any billing for actual implementation, or is it all brainstorming and meetings?

This story does not add up to me.

edit: I see in the graphic that apparently the work on Robin's project was for 1533 hours, so the 230 hours would have been just a portion. It makes me wonder what/how many other credit cards were used to pay for those other hours. Hard to believe Robin was above board for the first 1303 hours and then started paying with a stolen credit card.

1. Did the cardholder receive their money back?

2. If so, how much exactly?

3. How much of that amount did you receive, after fees?

4. Is "Robin" still active on the Upwork platform?

5. Do Upwork have the contact details of "Robin"?

6. What actions have they taken to recover these costs from "Robin"?

7. Who was the person whose card "Robin" had access to?

8. Why did it take them so long to spot the charges?

There are so many questions here. They can't just close the case. It's not a support ticket. This is a legal matter. If OP stops working right now, then he does pay the costs, but he does then have to find another income.

For anyone wants to try and help OP, consider liking/retweeting this: https://twitter.com/imdsm/status/1480176898600845312

Getting a lawyer involved will straighten things out fast. Upwork should eat the loss, no question. It'll easily cost Upwork more than 12k in time and resources if they try to defend it.

It'll cost you a few hundred USD at minimum but it'll be worth it.

But I think many people are not ready for the real world that their skills lift them into: being a contractor really is being your own business, and despite all the schtick about "platforms taking care of their freelancers", it's a business relationship, and really you all need to be looking out for yourselves.

At the same time, it comes across as pretty tone deaf of Upwork, and the developer attitude is understandable as well: can you imagine that if you faced similar risk from your financial / payment / banking services (such as, Payoneer or Pay Pal freezing your funds) Upwork would agree to cover you into another account until it was resolved? Highly doubt it.

Shouldn't Upwork have insurance for these types of fraud cases so they specifically don't have to pass the cost onto devs?

You can just refuse to refund Upwork. They are giving you the collections treatment, you can tell them to stop harassing you as well as report their behavior to the competent authority in your jurisdiction or theirs. Tell them to instead chase down the money from the payer.

edit: I remember I deeply reviewed a contract for a Russian Freelancing platform that was precise and fair -- I'm quite sure it had a clause that was like, once the payment hits your bank, it's yours no matter what. But the sensible thing was they had enough other precautionary stuff in the contract about how they handled payments, disputes and clients and so on, that it looked like they could make that work. They basically covered you for any clients that tried to abscond, I think.

If you don't do proper KYC and ensure that your 'customer' has the ability to pay and you allow them to pay via credit card (which is not at the discretion of the contractor, Upwork could have insisted on wire transfers instead) then the onus is on you, not on the contractor.

This is just a blatant attempt to de-risk the company at the expense of the weakest party. I'd tell them to go jump into a lake.

> ... he said this is a bit of a mess-up as he forgot that there is “a credit card connected in his account that wasn’t actually his”.

The typical chargeback is for a billing dispute, but this does not describe a billing dispute. If the client was authorized by the cardholder to use the card (ever, not just for these charges), the bank considers the charges authorized. The bank isn't going to get involved in a conflict with the cardholder and an authorized third-party. However, if authorization was never provided and the charges are reported timely, the bank will take liability and pursue their collection. In case of fraud, the bank might charge back to the merchant, but only if the merchant failed follow their contractual obligations in accepting the payment. In any case, I presume you have no way to knowing that the card was not your client's card, since you did not actually process the payment. This should be enough to get you off the hook, but only if you were truthful about your interactions with your client.

> Why would a bank take my side (a freelancer from another country) instead of his own actual client who never actually requested those services?

Because their business model depends on it: They make money when their clients get charged. If the cardholder ever get the client permission to use the card, the charges are valid, and the bank makes money.

> Let me get this straight — Upwork, a billion-dollar company, wants me, a freelancer, to work for free on their platform for approximately 230 hours (with my hourly rate) because a client on their platform was using someone else’s credit card?

This sounds generous. Often, payment processors want immediate repayment of chargebacks, especially ones as larges as these.

> How in god’s name is that my fault?

That depends. If you tried to protect your client by hiding from Upwork the fact that your client acknowledged using someone else's card, then that's how. If you were honest with Upwork, then I don't see they can recoup these charges from you, unless the contract you have with them says so.

If robin is not cooperating (not wanting to pay for your work - which then you give money for charge back), then you can go after Robin. You got scammed.

> Is Robin really asking for a chargeback? That’s impossible. I start investigating by calling Robin. He apologized and said he never called any bank, additionally, he said this is a bit of a mess-up as he forgot that there is “a credit card connected in his account that wasn’t actually his”.

And that's the last we hear about Robin in this story. Why is that? Did Robin vanish, or otherwise fail to rectify the "mess-up"? And why doesn't the OP seem upset at the fact that Robin was very clearly a con artist?

What is the benefit here. This is as good as directly working with a client. Atleast then you keep all the money without having to pay Upwork a cut.

Why continue working on Upwork? They are clearly not providing any value if they did not even do a basic verification to see if the card belonged to the client.

“In addition, notwithstanding any other provision of the Terms of Service or the Escrow Instructions and to the extent permitted by applicable law, we reserve the right to seek reimbursement from you, and you will reimburse us, if we: (i) suspect fraud or criminal activity associated with your payment, withdrawal, or Project; (ii) discover erroneous or duplicate transactions; or (iii) have supplied our services in accordance with this Agreement yet we receive any chargeback from the Payment Method used by you, or used by your Client if you are a Freelancer, despite our provision of the Site Services in accordance with this Agreement. You agree that we have the right to obtain such reimbursement by instructing Upwork Escrow to (and Upwork Escrow will have the right to) charge the applicable Escrow Account, and any other accounts you hold with us, offsetting any amounts determined to be owing, deducting amounts from future payments or withdrawals, charging your Payment Method, or obtaining reimbursement from you by any other lawful means. If we are unable to obtain such reimbursement, we may, in addition to any other remedies available under applicable law, temporarily or permanently revoke your access to the Site and Site Services and close your Account.”

Upwork is clearly by its own terms not an insurer against payment fraud or unauthorized credit card use. And the writer would have the same problem if he accepted CC payments directly: His own financial institution would debit his account for the chargeback and I’m not sure he would have any recourse against his bank.

The anger expressed in the comments here is understandable, and demonstrates empathy for the poor fellow. But to increase overall trust in the system, generally payment mechanisms are biased toward cardholder protection instead of seller protection. As consumers I think we prefer things that way — especially if you ever find yourself an unwitting victim of a identify theft or a stolen payment card.

https://www.upwork.com/legal#clientpayments

I think just to preserve brands goodwill, Upwork should absorb the cost (which they have to this point), pursue legal action against the client, and not punish the freelancer.

I don't know the legality of withholding payments for future work due to the freelancer. I don't believe they have a right under the terms to do that, but I would not do any future work for free. That could be a breach of contract on Upwork's part, although haven't read through these terms enough to know that.

The main issue here seems to be that Upwork isn't meeting its end of the bargain in exchange for the cut that they take - given all sides agree that the worked hours weren't fraudulent, Upwork should do what they would have done had time been tracked in the tool, and they should be providing protection to the worker and pursuing collections from Robin themselves (and eating the loss until they can recover the unpaid balance).

The human rights complaint in the article is rather weird though - Upwork isn't forcing him to work any extra - he could quit the platform today if he likes.

It reminds me of Paypal. When they first started, it was simple, not too expensive, but often ignored the consumer protection laws in the countries, and states, they operated in. Over time they have been forced to provide the same rights and implement the same regulation local market participants have to. In doing so they have had to raise price to the point where they are just another, now more expensive, player, with a good marketing name.

The bad part is, if you got on the wrong side of them in the early days, you lost your money and rights. These subcontracting companies are the same. By avoiding rights and regulation they can provide cheaper service. They can't do this forever.

> "I’m on very good terms with Robin."

So why Robin does not want to pay and help with Upwork if he is on very good terms with him? If you are in very good terms with Robin, then just ask him to pay for work. If he refuses (and he is not scammer), you can open a case in Upwork and then you will go in arbitration. The arbitration is quite reasonable and works well (I had to run one).

But if Robin is a scammer - then I'm really really sorry for you. There is very little you can do without lawyers and law enforcements.

Do not do any work for them.

Invest that time and build your name on your own or some other platform.

Take your clients off Upwork.

Would love to see what you’re doing.

You don’t owe them a thing.

https://chargebacks911.com/chargeback-time-limit/

There can be exceptions to this but I have never heard of a chargeback over this period and certainly charges a year or two old would be crazy.

Maybe what happened is that the cardholder initiated a chargeback on the most recent charges and Upwork decided on their own to refund them all?

In any case, it is primarily Upwork’s job to validate credit cards. If their position is that they failed to do that for two years and they have no responsibility, that is wrong.

Why hasn’t Al filed a criminal complaint?

1. The author (freelancer) did $12.5k amount of work that he wasn't compensated for

2. The owner of the CC that was "accidentally" charged $12.5k received all their money back through bank dispute

3. Upwork was able to claim their cut for the $12.5k worth of transaction that occurred between the author and Robin

4. Robin received $12.5k amount of work without paying a dime

Robin needs to pay the author back the $12.5k he is owed. If Upwork isn't willing to help reclaim the debt, he needs to sue Robin directly for the amount. It's very strange how much good will the author is willing to show towards Robin given how Robin is the only entity in the story who got away with all the spoils without paying a thing.

You can’t use someone else’s credit card without permission to obtain thousands of dollars if services. While the CC bank will charge back those purchases because they were fraudulently made, according to TFA, there is no dispute about the work actually being done and no one seems to be going after the person who benefitted from the work.

So I’m beginning to think, as they say, there’s more to the story.

In the case of 1), the work was performed and the output approved and received. So it seems pretty obvious that the money is owed by them to the freelancer.

In the case of 2), this entity bears responsibility for ensuring that payment is done properly. Things like, is the person paying the same as the card owner. (Btw, it sure seems like "paying with a card for an account that is not yours" is tantamount to fraud.)

In other words, either the client or Upwork should be on the hook, but DEFINITELY not the freelancer.

If so, what is the problem about asking Robin to simply pay again?

And the situation is trivial: no platform would survive if they allowed freelancers keep the money earned by carding, because it would be flooded with carders.

Full disclosure: i made over $2M on Upwork.

From a labor rights perspective, they are clearly not a small business that can take contractual risk, they are a de facto employee dependent on the revenue the Upwork platform generates. Withholding payment for work done is a major abuse.

Each side has their truth and I cannot see how it can be resolved in the general case without regulatory intervention in the area of platform labor.

When this happens and typically some time after the guest completed their stay, you receive an email from Airbnb saying "Problem collecting payment for reservation [XXX]" that explains how Airbnb will do their best to collect payment but they are not obligated to.

Basically these are platforms that will give you no choice in payment processing, but will also take no responsibility when it comes to fraud, nor give you any tools to fight fraud.

As many others have mentioned, if this is a fair world (i really want it to be), this is Upwork's problem and them eating the cost.

Funds not being "good" is not the freelancer's problem. It's literally why you use/pay a platform like Upwork. So you don't have to deal with wether the bank transfer happened.

i.e. How does the freelancer have any knowledge, power or ability to know whether the credit card being used is legit?

To my untrained eyes that seems pretty much a classic case of unpaid dues. Just get a consultation with a lawyer either way, it's the surest thing to do.

As a business, the money in my bank account can be taken back at any point and the onus of fighting back for it is on me. How is that reasonable?

Counter-example: for US employers, Upwork is a godsend when paying overseas staff, because they handle the legal, tax and reporting complexities.

Ideally, upwork works with the client to get the money owed. If it is a mistake and the client is willing to make all parties whole, great. If not and the client is unwilling to come up with a solution then I consider the client a scammer.

Strange story.

Why?? Hang it up, dude. Surely they have competition your could switch to. Or get a normal 9-5.

How is the bank or Upwork the bad guy here when it is Robin who doesn't want to pay?

BTW - I have extensive experience in credit card processing. It is VERy DIFFICULT to reverse a chargeback. Upwork is at the mercy of Visa/MC/Amex, and the developer is at the mercy of Upwork. Upwork can choose to not use Visa/MC/Amex but they add enough value to accept the chargeback risk. The developer can choose to not use Upwork but they add enough value to accept the chargeback risk.

He can walk away from this, use a competing platform, and not pay a dime. Upwork has already paid back the $12k+ and are stuck, which is the primary reason why they should consider the 50/50 split of future income.

I’m sure Upwork has armies of lawyers who would argue that you’re an actual business and this is a business to business dispute. And I’m sure you accepted some 78 page document that says that too. But unless you have an incorporated entity and are operating like a business I’m not so sure a regulator would see it that way.

There’s a lot of laws out there involving freelance workers, subcontractors, and so on, and I’d figure out which of them apply to you.

Also like others have said you don’t owe them anything don’t do more work on Upwork to pay off this “debt” fuck that.

And also chargebacks in the US at least have strict time limits, so the amount of delay here in informing you seems relevant. But not sure what the rules are where you are.

At this level of trust, you should establish a direct relationship with the client.

However, even if Robin started PayPaling him directly, Robin could still file a charge back. Robin knows exactly what he did, he just doesn't care.

But at least then you don't have 20% being skimmed off top.

I found all my contractors ( aside from Fiver, but these are 100, 200$ gigs) via doing my own research. I've wasted at least a thousand on work that wasn't really good. But the stuff that is usable, is fantastic.

Anyway, OP is still on Upwork, so why's he complaining. If I worked somewhere and then randomly asked me to give 4 months pay back, I'm out.

https://www.case.org.sg/consumer_guides_consumeralerts_archi...

Assuming the events described in the blogpost are factual, this is what happened:

The card issuer is representing the "someone else" to get back the money. The acquiring bank for Upwork complied with the request and deducted the money from the Upwork(the merchant)'s business account with them.

Then, it is Upwork's decision to recoup their losses in their business account with the acquiring bank by asking Al to work for free.

I think Upwork treats freelancers as their employees. So Upwork believes it can manipulate them.

I work in finance and this is often a total no go in many industries , even with consent of the card holder.

But going strict on this will cause friction I suppose, just like CVV codes aren't mandatory on transactions, so some companies leave them out of the payment process. It only helps a bit during a charge back defense to have CVV and 2fa enabled.

I have read about other dodgy things that Upwork has done before, nasty bunch.

Predictably, this outcry will make them "rethink" their position on this one case and they will "apologize" and most likely not update the KYC checks and carry on as usual.

This is my major problem with all these "platforms" Follow our rules under the guise of protection yet when the poop hits the fan they will still try to shaft the expense onto you rather than fix their mistake while they rake in money. I bet upwork are not giving back their commisson/fee.

Also this is totally on them. They took on the burden of handleng the transactions they should have caught this a long time ago. Idk poland laws but i doubt they have any legal recourse against op. Though of course they will ban him for anothet client commiting fraud while he jumped through their hoops....

1) Does the freelancer have the ability to verify the client's credit card? For example, can it tell Upwork "assume all responsibility for fraud from this point forward" if that is not the normal default?

2) If no, but Upwork does have that ability, then Upwork is responsible for fraud.

3) If Upwork still insists on its current arrangement, does it disclose this scenario's possibility to the freelancer? I don't mean "implied by the fine print, but upfront, in a way that can't be missed"?

4) If no, then again, Upwork is responsible for the fraud.

A client, presumably doing blockchain shit, committed fraud and fucked the freelancer.

I'm shocked, shocked, to see fraud committed by blockchain entrepreneurs.

Oh wait, that's the whole racket.

As others have noticed, the site takes a 20% fee, which is reasonable if it provides protection in problem situations like this. But if they immediately demand the worker to repay all their income, it's hard to see how they can even justify this 20% fee which is higher than any standard introduction fee in the recruitment sector.

If it was me, I'd immediately stop using the website and get a lawyer involved. From the article, it's clear the client has admitted the work was done and used a credit card that wasn't theirs. So, at that point either the client has committed a fraud using someone else's card without permission, or was given permission to use the card in the past, in which case it's the cardowner's problem and up to them to sue the client for the money. Whichever, it's not their author's responsibility.

So, for him to continue using the site, he must think that the potential future income would cover the lost 230 hours work, which itself seems suspect, as that represents about 1.5 months. He'd have to increase his rate significantly to make that back, so his best option is to find contracts elsewhere.

1. Upwork connected the client and freelancer. 2. The client used someone else's money/credit to pay the freelancer. 3. The fraud was found out and the money refunded.

This, then, IMO is between the client, Upwork, and the police. Nothing to do with the freelancer. They are a victim in this fraud as well. Upwork have no right to demand money from the freelancer, their platform allowed the fraud, they're liable.

My guess is that Robin was uncollectable for whatever reason, and Upwork is now going after the freelancer. They don’t want to left holding the bag on the fraud, even though it’s their responsibility to prevent fraud

If this is true and the debacle had been happening for the last 40 days, writing a post recommending upwork is the last thing I would be doing.

Secondly, why wouldn't the author get hold of "Robin" and make him pay. The post doesn't even discuss him attempting to do it.

As a buyer, I love gig boards. As a developer, I don't.

Who eats the cost in this particular case is a gray area - I believe Upwork should be suing Robin to try to recover the funds.

I can feel for the freelancer but the real victim is CC owner - charge back was the right move.

Upwork action item: Robin needs to add a new payment instrument to cover the $12000 debt. Freeze Robin's account until then. Any fraud being perpetrated requires Robins involvement, so lean in there.

Upwork action item: tell author that if author hires a lawyer they'll share information necessary for author to pursue a case against Robin.

Author action item: have a lawyer take a look at case vs Upwork and Robin as joint defendants. Make the defendants sort it out.

Kind of am aside, but if Upwork takes zero responsibility and provides no value for the manual payments, seems like all manually tracked work ought to be billed directly between freelancer and buyer. They won't even pursue Robin, the holder of the wrong credit card it seems even when Upwork knows who Robin is.

Seeing that they worked on investment presentations tells me Robin might be a fraud out the gate.

Grifters grift you by being your buddy and not some sketchy person selling you a used Rolex hanging on the inside of a trench coat.

Non-payment is actually a surprisingly common problem in the world of freelancing. You won’t see it if you have a handful of established, trusted clients. However, it crops up a lot if you deal with individuals, entrepreneurs, or startups.

As an individual, you can simply refuse credit card payments completely. You can also stop work completely until the client is caught up on payments.

With Upwork, can you even choose to reject credit card payments? Or are you forced to take the risk of credit card chargebacks?

As for recourse: The amount is high enough to get a lawyer involved. Go after Robin, demonstrate non-payment, get a judgment. I’m guessing Upwork’s legalese and corporate counsel aren’t worth going after.

I contacted my cc company to perform a chargeback and was denied. Upon further reflection I should have sued the lawyer in small claims court but I was somewhat embarrassed by the whole affair and just let it drop.

Unfortunately in this case I feel like upwork is worse than not as you’re not directly negotiating and proving your case to the cc company. I would imagine upwork put about zero effort into defending this guy, because hey, he’ll just work for free for the next two months! No risk here!

One party did their fair share, the other party did not.

Seems pretty cut and dry this is Upwork's problem to solve, not the party who did the work.

However upwork allows workers to record their completed work is irrelevant.

Put your tools down. You're not indentured. Don't work for nothing.

The dispute is between them, their customer and a bank. The actions they're taking are just the easiest for them. In their eyes, you have a livelihood on the line. Of course your going to buckle first.

Short of actual legal action, you could contact all your long term clients and tell them to seek alternative escrow arrangements if they want to keep working with you. That'll likely get you banned from Upwork, but freedom has value.

Getting a chargeback from 2 years ago is unheard of. Even 6 months is stretching it from the most generous credit card provider, AMEX.

I would just ignore it and close my upwork account and change bank accounts. It sounds like bullshit to me.

If you want the maximum legal protections around getting paid for your work, you need to be an employee.

Beyond that, ultimately it boils down to Robin has not paid for the work performed. The freelancer needs to demand payment from Robin directly, and if he won't pay, file a lawsuit against him if Upwork is not going to help. Will be difficult with Robin apparently being in a different country, and probably not worth it for only $12k, the legal fees and time spent will certainly exceed that amount.

Charge it off as a lesson learned, and a 12k business loss on your taxes.

Tell them to fuck off and find another platform; and pay them nothing.

The bigger sites that take a large percentage of the customer's money (40-50% goes to the site, not the model) also protect the models from chargebacks. Sites that take a lower percentage do not. One site she worked for ("cam model directory") has a spreadsheet of customers who are known to issue chargebacks that the models have to monitor before taking payment.

So why not have Robin sort out the payment? There's no mention of that from the freelancer or the freelancer's account of upwork's responses.

If someone has stolen money and made purchases (which is generally the purpose of theft), then recovery procedure should be with law enforcement. That will be the police. Of course this takes time and effort, so what you are expericing is a company trying to shortcut the process and leave you holding the bag.

How can you be sure of that? Robin can just be lying.

In both cases, Robin opening the chargeback or Robin using someone else’s credit card, it’s Robin responsibility to pay you! Not sure why OP is so adamant to protect Robin.

But that would mean more costs and loosing some people, right Upwork?

Days of closed-door marketplaces are over.

So next time, any one on HN thinks about writing yet another todo app, think about disrupting freelancing industry and upwork. It won't be cool and won't make HN top page most likely but it will most likely be a product and monitory success.

And if they come after you, hire an attorney and manage it away from.... the internet...

> I could’ve easily gotten paid from Robin outside of Upwork.

So why doesnt he get the money from Robin who hasn't paid yet and pay Upwork back?

Barring that, just leave Upwork and don't return the money they asked for. Anyone can ask you for money, and you can say no.

The fuck is wrong with you. Drop Upwork