Tuesday, August 22, 2017

Heartland Payment Systems Lawsuit -Dirty Secret?

Well it seems some interesting information has been put out by a former employee about exactly what Heartland Payment Systems (bought out by Global Payments) was doing, some of which may not have been public knowledge.

I will paste it here in case the link is taken down:

Heartland Payment Systems Customers have filed a class action suit in New Jersey Courts against the processor for consumer fraud possibly 2.6 billion in unjust enrichment!

Heartland Payment Systems merchant's filed a class action suit claiming that in 2014 Heartland implemented a scheme committing consumer fraud resulting in unjust enrichment. The class action complaint was filed in the United States District Court District of New Jersey, 
the Plaintiff Rudel Corporation Civil No: 3:16.cv-02229 Squitieri & Fearon, LLP NY, NY

The 29 paged suit exposes Heartland's plot in detail of how they used an American Express Program called OptBlue to bait and switch customers into thinking Heartland was acting in the customers best interest with transparency. According to the documents it appears at first Heartland was indeed giving the New American Express Opt Blue savings to the customers as they claimed they were. However, the merchants claim this was smoke and mirrors. Instead of passing on the savings to the customer Heartland kept the savings for themselves. 

American Express lowered their fees. Heartland decided not to pass those savings onto their customer as they claimed. Instead they added a new American Express Discount fee for their customers to pay. So the customer paid less to American Express but more to Heartland for the exact same services Heartland had already been providing for the lower fee the month before. The customer was saving money, as I am sure we will hear Heartland rebuttal, but not what they should have been saving apparently. Here is where it gets sticky. Four months after the initial supposed scheme was implemented they increased their fee again. 

The suit states the increase was fifteen times the initial amount. It also states that Heartland sent a notice on their statement to the customer's stating they miscalculated their rate they needed to charge. But the fees were just part of the issue, apparently this notice Heartland sent was a breach of the customer's contract as it violated a 15 days notice which Heartland did not honor. Heartland better be prepared to explain to these customers how they miscalculated pure profit. That would be my question. Especially profit that needed increased in 4 months and back billed as well which apparently Heartland billed to customers on their October 2014 statements. 

According to the suit there is approximately 2.6 billion dollars over the last two years in question. This will be an interesting one to follow. What will this mean for Global? 

What I can't believe is how I saw this on the docket and think this is bigger news than the stockholders class action suit when Heartland announced the sell to Global, yet you haven't reported this yet at all. Heartland has built its reputation on honesty and transparency. If they are found guilty, this means not only do we have a lying Ted, we have a lying Bob who pulled a fast one on the consumer, then knowingly sold his sour lemon off. Time will tell but its worth investigating further in my opinion.

Wednesday, August 2, 2017

Class Action Law Suites Filed Against EVO Payments.

Yet another processor is in the line of  fire of a class action lawsuit. Both EVO Merchant Services and EVO Payments International are the subjects of this newly filed suit by Atlanta-based law firm Webb, Klase & Lemond, LLC. The suite alleges that EVO maintains a policy of overbilling merchants. This is why it's important to look for a honest merchant service provider that does not lock you into a contract. This practice of promoting low teaser rates that go up quickly is unfortunately not an uncommon practice.

From PRWeb.com:

EVO is the world’s largest privately owned payment processor, with over 500,000 merchant customers. The suits allege that EVO represents to merchants that it will only charge the payment processing fees and rates prominently disclosed in the Merchant Application but that, after merchants sign up and the parties begin to do business, EVO imposes new fees and increases the agreed-upon rates. The suits allege that these overcharges are effectively hidden in monthly statements.

According to the complaint, EVO has allegedly advertised low payment processing fees despite knowing that the actual fees would be much higher, concealing important portions of the contract from merchants, and imposing fees that were much higher than those disclosed. Several specific fees, such as “PCI” fees and “IRS Reporting” fees, are alleged to be imposed by EVO in an automated fashion, without regard to the agreed-upon rate structure.

The plaintiffs seek the return of all amounts they paid EVO that exceed the rate schedules set forth in their merchant applications.The cases, styled New Beginnings v. EVO Payments International, LLC, et al. and Central Florida Liquidation and Sales v. EVO Payments International, LLC, et al., are pending in the United States District Court for the Eastern District of New York and have been assigned case numbers 17-cv-3650 and 17-cv-4507, respectively.

If you wish to discuss these actions or have any questions concerning this press release, please contact Webb, Klase & Lemond, LLC at (770) 444-9325 or contact(at)WebbLLC.com.