Credit Card Fraud - Restaurants/Clubs
shailynn
They never tell you what you need to know.
Before COVID I used to take clients out a lot even if it was grabbing a quick lunch at a sit down establishment. In a years time I probably would have over 150 transactions in one of the above mentioned places where I had to add in a tip at the end of the bill. I’m not talking a Panera or Starbucks where tipping is relatively new or other places will here tipping is questionable, I’m talking a sit down restaurant where you are waited on or a bar. I’ve always waited for the day when a tip amount is going to be different that what I wrote on the receipt, but to the best of my knowledge it’s never happened.
Has it happened to you? I’m kinda surprised it hasn’t happened to me, or maybe it has a few times and I didn’t notice, but I’m usually pretty meticulous about receipts because I need them for business purposes.
Lastly - tipping guilt is a real thing and I fall for it all the time, mainly because I fear looking like an asshole and an extra couple of bucks here and there isn’t going to kill me.
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The one time in my life I paid for dances with a credit card, they took a copy of my ID. I know, thinking with the wrong head. I figure they're used to people claiming fraud after doing it and you can't refund a dance.
What I am starting to see more are restaurants that will charge you a 3-3.5% service charge when you pay with a credit card versus cash. They are putting the service fee the credit cards charge the restaurant, directly onto the customer.
I think the interbank rate for most businesses is much lower than 3.5%, if they’re charging that much as a fee for using your card they are ripping you off.
BTW when I was in business before I retired my fee for MC, Visa, & Discover was .560% a bit more than a half point, and I never had any problems taking plastic it actually increased my sales by over 33% I looked at it as a win/win.
If you have a smaller business you can join several different associations like The National Federation of Independent Businesses, or Trade Associations as well as your local Chamber of Commerce and get better rates than the 3% you’re talking about.
Anyway, I've never had issues with fraud on my account after using it at a restaurant or bar. But I do not ever give my card to people who are going to make photo copies of it, along with my drivers license, like is the policy of many strip clubs. I have had issues with fraud as a result of the home depot fiasco where their systems were compromised. I also had issues that I think stemmed from a skimmer at a gas station. In both cases the credit card company paused the charges, did an investigation, and reverted them. The only real hassle for me was having to call in to dispute & wait two days for a replacement card.
Here's a fun tip though to prevent fraud from happening. Make your tip add up so that the tens of the total match the cents. For example, say I'm paying a drink bill of $65.50. I'd tip exactly $16.31 on this bill so that the total comes out to $81.81. If the bill was $162.40, I'd tip exactly $32.54, for a total of $194.94.
If you get in this habit, you can quickly and easily scan your CC statement to look for outliers where your cents don't match your tens:
✅$81.81
✅$194.94
✅$65.65
❌$95.05
Since I've been in the habit of tipping like this, I have spotted plenty of cases where a waiter or waitress keyed in the wrong amount, either intentionally or unintentionally. Usually it's not worth battling over a few bucks, but on at least one occasion, I've successfully initiated a dispute over the waiter padding the tip, just to make a point.
Third time, tourist town, they knew I wasn't coming back, added $5 to the tip. Bastards. I've also had one server charge me for a drink I never ordered. Didn't get the itemized bill until it was too late.
I've never had tips added to a charge but I've had my credit card hacked 3 times. It's gotten to the point that I check my cards online every morning when I wake up. Doing that, I caught a bogus $20 charge before anything serious could be done.
Credit card fees are a cost of doing business, and should not be passed onto customers as surcharges. I would rather see a 5% increase in menu prices than a 4% surcharge, as a surcharge seems grimy.
And, there is a cost to cash handling, including bank fees and lost cash, as well as increased time to count/reconcile.
Originally the credit card companies had agreements with the merchants that expressly forbid the addition of such a surcharge, and when these credit card firms started the merchants would complain if they were denied access to their services that they would lose business by not having the ability to use these services.
Just a thought if their customers were limited to purchases that they could cover immediately their ability to sell would be limited and their bottom line would be impacted and not in a positive way.