Consumer complaint received 2020-05-05
Company: U.S. BANCORP
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Fees or interest
Sub-issue: Problem with fees

Complaint:
XXXX ( XXXX XXXX XXXX XXXX XXXX XXXX ) is a not-for-profit corporation that receives credit card payments from members annually. Elavon ( formerly XXXX XXXX XXXX before name change ), a wholly owned subsidiary of US Bank Corp., is the credit card processing company that processes members credit card payments to XXXX. A contract was executed by XXXX in XXXX with XXXX XXXX XXXX. An accounting analysis from XXXX onwards has indicated that there has been an overcharge of over {$75000.00} from XXXX up to XX/XX/XXXX as compared to the contract with Elavon. Elavon has not produced any documentation as to changes in the contract rate despite numerous requests from XXXX. We have asked to be reimbursed the overcharge but Elavon refuses to cooperate. 



1. XXXX XXXX XXXX, a wholly owned subsidiary of US Bancorp, changed its name to Elavon in XX/XX/XXXX. See XXXX PRESS RELEASE enclosed. Since XXXX Elavon has been the credit card processing company for the XXXX XXXX XXXX XXXX XXXX XXXX ( XXXX ), a non-profit corporation. 
2. Enclosed Merchant Application is the original application signed in XXXX by XXXX XXXX XXXX, the then president of XXXX, in which a rate of 2.54 % for qualified transactions and 3.54 % for non qualified transactions are set out. In addition there is a .XXXXper item charge. 
3. I have done an accounting analysis of the credit card charges since XXXX as I only have available financial statements going back to XXXX. The analysis is XXXX Elavon Charges enclosed which shows the fees being charged and the credit card revenues. We have used 80 % as an average of the credit card portion of total income received given that is the best estimate of the administrator that looked after this for 11 years. The other 20 % is received by check. The financial statements only show income and do not segregate credit card income from check income. Hence the 80/20 split is an estimate which we believe is accurate. 
4. In the XXXX Elavon Charges Analysis note that there has been an over-charge of {$75000.00} over this period up to XX/XX/XXXX. In addition we were advised that a reasonable interest rate to use in this situation would be 5 % per annum which we used to calculate that we should receive {$93000.00} total rebate for the over-charge. 
5. When we first identified this over-charge we got in touch with Elavon and we were directed to deal with Mr. XXXX XXXX XXXX, client rep. See Correspondence enclosed for the ongoing correspondence. He initially indicated that Elavons fees are noted at the top of the monthly statements sent from Elavon. We searched our files and could not find any such notation on any of the statements. I then asked him to produce a copy showing such a notation and he indicated that they dont keep copies, which I find hard to believe for a banking organization. At that juncture he claimed that Elavon sends an annual rate increase letter. We looked in our files for these we found none. I then asked him to send us a copy of the rate increase letters that he claimed had been sent to us and he responded that they dont keep copies ( see his XX/XX/XXXX email ), which I find to be ridiculous for a financial institution. I then notified him on the amounts owing based on the XXXX Elavon Charges Analysis. He responded that their Terms of Services agreement permits them to charge these fees and as such no compensation would be forthcoming although they were prepared to give us a three month rebate. The Correspondence enclosed comprises ( note that time stamps shown on the emails differ based on time zone differences ) : a. XX/XX/XXXX from XXXX XXXX, the executive director of XXXX at the time to XXXX XXXX outlining the problem and asking for an explanation. 
b. Response XX/XX/XXXX from XXXX XXXX saying that there are two rates and that the non-qualified rate is 7.5 % plus XXXX for each transaction. This was completely new information for us. We had never been informed of there being a qualified rate and a non-qualified rate. Furthermore he was offering us to get on to a new program which is very similar in rate structure to what we had thought we were on based on the original application. Why nobody from Elavon thought it reasonable to inform us of this prior to our complaint is something we do not understand. 
c. XX/XX/XXXX from XXXX XXXX asking for an explanation as to qualified and non-qualified rates. Also letting Elavon know we had never been informed of this before despite repeatedly asking for information. 
d. Further correspondence on XX/XX/XXXX back and forth culminating in XX/XX/XXXX from XXXX XXXX indicating that he would submit a general complaint into their system for it to be researched. 
e. XX/XX/XXXX from myself, XXXX XXXX, treasurer of XXXX since XX/XX/XXXX, to XXXX XXXX asking for a variety of material including contractual arrangements. 
f. XX/XX/XXXX from XXXX XXXX saying that there was no contract, that the account was on a month by month. Followed by another email on XX/XX/XXXX from him after several phone calls between us. In the phone calls he first said that Elavon fees were noted at the top of monthly statements. We searched our files and could not find any such notations-see Sample Statements enclosed. I then called him back asking him to produce a copy. He then called me to say that they dont keep copies but that they send an annual rate increase letter. We then searched our files again and couldnt find any of these either. Then I phoned him and told him that we couldnt find any and could he please send us copies. He sent his XX/XX/XXXX email in response indicating that they do not keep such letters on file. It is hard to believe, given that they are a financial institution, that they do not have financial records of statements or rate letters if these actually existed. 
g. XX/XX/XXXX from me to XXXX XXXX : in this I outline that what they had charged us was contrary to their press release claims ( see Press Release enclosed ) that they would respond to the expanding needs of merchants in multiple segments in helping businesses better manage costs. They had certainly not done that with us so this was false advertising as far as I was concerned. I asked if they had an Ombudsman/Complaint process. 
h. XX/XX/XXXX from XXXX XXXX to XXXX XXXX. In this email he forwarded the Terms of Service the first time we had ever seen this. He drew my attention to 18.2 in which Elavon is required to inform the client of a proposed change in a periodic statement or other notice. They have not produced any copies of any notices to us of any kind as to rate increases. In our files we could not find any and we find it incredulous to think that a financial institution would not keep records. Attached Statement Samples shows the kind of statement we got monthly from Elavon. There is no notation of rates. 
i. My XX/XX/XXXX email which is self explanatory. 
j. My XX/XX/XXXX email to XXXX XXXX reviewing the overall situation and our analysis. In it I attached the XXXX Elavon Charges analysis and what they owed us to reimburse us for the overcharges. 
k. XX/XX/XXXX email from XXXX XXXX to me indicating that they have deemed that they are not at fault ; that theyre willing to give us a three month refund ; and other factors they offered which they indicated would save us money. We have not responded to this because we have last any trust in Elavon and hence we have changed our credit card processing to a different company. 
6. The Terms of Services Agreement XXXX XXXX referenced had never been sent prior to his XX/XX/XXXX email. Enclosed TOS - ENG is what he sent. In the Terms of Services the following are of interest : Article 7.3 indicates that they may adjust fees in accordance with Article 18.12. However, Elavon never once notified XXXX  that they were changing the rate. Had they done so XXXX would have certainly shopped around for better rates than the 6-7 % rates Elavon began charging without our knowledge. There were and are many substantially better rates in the marketplace. 
Article 2 sets out that the TOS is binding based on the company application which constitutes the acceptance of the terms and conditions contained in the TOS. The only company application was the original one signed in XXXX. 
Article 18.6 calls for arbitration for any disputes. However XXXX can not afford a full scale arbitration. We need to rely on consumer protection. 
7. We have never received any of the documentation that XXXX XXXX of Elavon has claimed was sent and they have not been able to produce any such documentation. They have consistently tried to obfuscate and, in my mind, their claim that they have no records is a falsehood. This is a financial institution after all! 
8. I, XXXX XXXX, became XXXX of XXXX in XX/XX/XXXX. I am an unusual XXXX in that I had a business career of over 25 years before beginning my training as a XXXX. Prior to me becoming XXXX in XXXX, XXXX there was no one in the organization who had the business acumen to analyse the credit card charges, and Elavon took advantage of this to charge whatever they wanted at egregiously high rates. Elavon never properly informed us of any of these rate changes.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with non-monetary relief