John is interested in signing up for a currency trading system that says it will turn $10,000 into $100,000 in a year. The service says you have to try it out for 90 days before canceling and he’s worried that that’s just to avoid chargebacks. John should probably be worried about some bigger stuff than just a chargeback.

John writes,

Hello.

I just came across your website while researching cc chargeback. I’d like your informed opinion on being able to collect a refund after 90 days of purchase. This vendor selling a [currency exchange trading system that he says will turn $10,000 into $100,000 within a year] offers 90 days.

However, customer must test the system for the entire 90 days before claiming a refund.

I have two fears: a) the credit card company won’t be helpful after 60 days; b) the vendor may withdraw all the funds before 90 days and so the credit card won’t be holding anything to issue a refund.

Thanks for your feedback.

John

So many things wrong here. To answer your basic question, your chargeback window varies depending on your credit card, anywhere from 60-120 days. Check your terms and conditions.

Second, the credit card company is not holding funds in escrow for the merchant. That’s not how credit cards work. In the event of a dispute, it’s on the bank’s head to give you your money back, and then it’s up to take it out of the merchant. You getting your cash back is not contingent on what they work out with the vendor.

Third, I Googled the service you mentioned and it has a lot of complaints against it. It looks like the people set different “systems” and market them, a few people say they make money, and the rest lose out. I’m not going to mention the name of it because I don’t want to give it any help in Google search rankings, but if something promises to turn $10,000 into $100,000 within a year, and it’s being marketed via a cheap voiceover slideshow on a website with multiple sub-directories, you can be pretty sure it’s a scam.

If you really want to trade currency, there’s more well-established forex services out there that you should check out, like FXCM, Ifx and Gain Capital. I almost hesitate to say their names because based on your knowledge of credit cards and interest in fairly obvious scams, it looks like you need to do a lot more research from reputable sources before investing. Perhaps get a recommendation from a friend for an honest broker, or look into low-cost index funds? At the very least make use of the practice accounts on the forex programs and get a handle on how it works before committing any real money.

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