Consumer complaint received 2024-07-13
Product: Payday loan, title loan, personal loan, or advance loan — Installment loan
Issue: Charged fees or interest you didn't expect — 
Company: Affirm Holdings, Inc (CA)

Hello, I am writing to formally request an investigation into Affirm Loan Services, LLC due to their handling of a recent chargeback dispute that I experienced. This issue highlights broader systemic problems that necessitate regulatory scrutiny to prevent further harm to other merchants and consumers. 

Summary of Events Order and Chargeback Filing : On XX/XX/year>, a customer placed an order with our business. 
Shortly after, the customer filed a chargeback, mistakenly believing the package was missing. 

Once the customer realized the package was on the way, she requested almost immediately to reverse the chargeback. 
Customer and Merchant Communication : The customer contacted Affirm via chat and on the phone multiple times, informing them that the chargeback was made in error before the case was closed. 

I, the merchant, also sent documentation before the case was closed. 

Submission of Evidence : I submitted irrefutable evidence, including : -Our entire email chain showing the customer apologizing for filing the chargeback and showing screenshots of her reversing it. 
-Our shipping policy, which shows we followed our procedures. 
-The XXXX XXXX timeline and confirmation. 
-Proof that the package was delivered before Affirm closed the case. 

Inadequate Investigation : -Three days after the customer filed the chargeback, Affirm closed the case. 
-Their policy clearly states that both parties have 15 days to submit all documentation and are entitled to a fair investigation where all evidence is reviewed. In fact the email they sent us said we have until XX/XX/XXXX to submit all documentation. 
-Had they looked at the evidence, there is no way they could have come to the decision to " side with the customer '' especially since the customer told them multiple times it was an error on her end. This is chargeback fraud since they knew this was made in error and they still proceeded with the chargeback. 
-They sided with the customer, who has not paid any fees to them yet. Instead, they decided to deduct the amount immediately from my account. Again, both the customer and I have called, messaged and emailed Affirm multiple times before the case was closed to clarify the error and submit all necessary documentation they requested the same day. 

Ongoing Issue : -Instead of reversing the charges immediatly, Affirm took our money and still has our funds. 
-The customer and I would like to proceed with the return process since she did not receive the package in time for her event due to the XXXX of XXXX holiday delay. This is no problem but I am unable to do so because Affirm has my funds. 

Lack of Resolution : -I have contacted them multiple times, but they keep spinning the customer and me in circles. 
- No one has emailed me backed after the multiple emails and calls begging for someone to contact me so we can fix this simple issue. 
-During a three-way call, it became clear they could no longer pit the customer and me against each other, and they had no explanation for their actions. 
-I have recorded our calls and have multiple emails from them, but they still have not responded to the multiple emails I have sent. 
- They purposely make it difficult to get in contact with anyone or come to a resolution. As a financial institution this should be illegal. Customers and Merchants should have the right to speak with an actual representative to help address issues immediately. 

Broader Pattern of Misconduct Upon researching the company, I found that this is not an isolated incident. Affirms behavior indicates a broader pattern of misconduct that needs regulatory attention. 

Poor Ratings and Reviews : -Affirm has a XXXX out of XXXX stars rating on the XXXX XXXX XXXX XXXX XXXX XXXX based on over XXXX reviews. 
XXXX XXXX rated Affirm XXXX out of XXXX stars, based on over XXXX reviews. 
Common Complaints : -Formal complaints filed with the CFPB include issues with making payments, unexpected fees, and inadequate refund options. 
-Numerous reports indicate that consumers are forced to continue making payments even after returning items. 

Failure to Conduct Proper Investigation : -According to CFPB Regulation E, financial institutions must promptly investigate and resolve disputes. Affirms actions did not comply with these requirements. 
- According to their policy we had 15 days to submit all the evidence and resolve the dispute between the customer and merchant. They did not review anything, they did not investigate and they did not do their due diligence. Had they done what their policy states they would have seen this chargeback was made in error. 

Notification Requirements : - Affirm did not properly notify both parties within the stipulated time frame as required by their own policy ( CFPB Regulation Z, 12 CFR Part 1026 ).

- They told us we had 15 days to submit and file all the necessary documents and then closed our case within 3 days and did not review or look at anything we sent. They just decided it was easier to profit off the merchant and was able to take the funds out of our account directly instead of requesting payments from the customer. 

Request for Investigation Given these points, it is clear that Affirms practices may constitute chargeback fraud and violate federal consumer financial protection laws. I urge the CFPB to : - Investigate Affirms handling of chargeback disputes. This is clearly a pattern and is happening to other people as well. 
-Ensure Affirm adheres to regulatory guidelines and provides fair treatment to merchants and consumers. 
-Take necessary actions to prevent further misconduct. 
-They appear to intentionally make it difficult for customers and merchants to resolve issues, likely to collect additional fees and interest. 

Thank you for your immediate attention to this matter. 

I have more emails, screen shots and proof if needed. I also recorded our XXXX way call with Affirm, the customer and myself ( the merchant ). 

Their licenses- Affirm, Inc., XXXX ID XXXX. Affirm Loan Services, LLC, XXXX ID XXXX. 

Best regards, XXXX XXXXXXXX XXXX XXXX