Complaint Review: Merchant Processing - MPI - Michael DeGroat - Mitch Reisberg

I am a hair salon owner who was contacted by Mitch Reisberg, MPI sales manager, during the week of May 23, 2005. He reviewed my current credit card processing company's statement and said MPI could offer a better deal. After thinking about it and STILL having reservations, I signed the contract with the specific promises of a 1.63% processing rate per transaction with no additional fees on each transaction, a $10 monthly statement fee and a $69 annual fee (paid monthly).

Also, included in the offer was a new credit card processing terminal because Mitch said that the existing machine would not integrate with MPI's system. But most importantly, he specifically claimed that the cost of the lease of this new equipment would be included as part of the processing fee and that there would be no separate charge. I initialed the equipment lease (no monthly lease charge was included at this time) with A-1 Leasing AND signed waivers that Mitch included that released me from any obligation if I wanted to cancel the contract with MPI or the lease agreement with A-1. He also verbally confirmed these terms. To date, I have never received copies of these original documents after many requests.

I received the credit card processing terminal which arrived with no documentation and appeared to have been used NOT new as promised. I contacted MPI customer service again regarding the copies of the signed documents. On this occasion, I spoke with a customer service representative named Amanda who said they didn't have the original documents at her location, but that they should be in the mail.

Around June 10, 2005, Amanda from MPI contacted me to confirm that I had received the credit card machine so she could set-up my account. I said that I would not set up the terminal until I had a copy of the signed contract in hand. At this point, Amanda faxed the contract which was altered from the original one, including an additional $.16 per transaction fee; and $59/mo for 48 months lease payment for the terminal. When I complained that this was not what I signed and that I wanted to terminate the contract and lease, she said I needed to speak with Mitch and that she would ask him to stop by the salon.

A few hours later, Mitch stopped by the salon and promised that the contract would be taken care of and made manual changes to the faxed copy that reflected our original agreement including no .$16 charge and that the lease payment was deducted from the processing fees. I completed the week with my current company.

On June 14, 2005, Mitch returned and set up the credit card processing terminal. At this time, Amanda from MPI also called to get a telephone agreement for the equipment lease. Mitch advised that me that I should agree to the terms that Amanda outlined (including the $59/month for 48 months payment) over the phone because it makes it easier and that he would resolve it after the fact. This made me really nervous but I did it anyway and used MPI for the next 6 days. During this time, MPI not only charged the 1.63% processing fee but also deducted the $.16 per transaction fee from my checking account.

For the next week or more I got the MPI run-around. Every time I tried to get copies of my original documents or resolve the issues with the additional charges, I got passed around to Bobby, Carly and Mike DeGroat. At one point, Mike DeGroat had the audacity to claim that with all of these extra charges, MPI still was costing me less than my old company!

Finally, I stopped using MPI and went back to my old company who hadn't been canceled yet. I also closed my business checking account and began to shift funds to a new one. When I tried to get information on how to cancel with MPI, Carly told me that I couldn't and if I did I would never be able to get another company to process credit cards again. My old company confirmed that this is a complete lie! Finally, I was able to get a straight answer write a letter on company letterhead explaining why you want to terminate and your Merchant ID # which I never received on any documentation! I was able to get it eventually from Tech Support and I faxed my letter.

Also, I called A-1 and spoke to Steve Miel who said the lease had not been funded yet to MPI and that he could cancel it because the account was not in their system. He said I should ship the credit card processing terminal back to MPI. I called MPI to get the appropriate shipping address and was given a personal mailbox address. As a result, I shipped the equipment back to the address on the original packaging.

Hoping this was all over because Mitch told me I could cancel at ANY time, I was floored on July 5, 2005, when MPI debited my business checking account in the amount of $35, which included the agreed upon $10 statement fee AND a $25 minimum charge fee. After six business days, I processed charges in excess of $2,900. I called MPI and requested a copy of his statement which they faxed. The statement I received was even MORE than $35 a LOT more. For starters, the statement included a host of surcharges and batching fees that were never disclosed in the original contract or verbally with any MPI representative, the statement fee of $10 charged twice and whopping $743.50 labeled Misc Debit. When I spoke with Jennifer at MPI, she said the $743.50 charge included a cancellation fee and the originally waived start-up fee. She also was not aware of the $35 already deducted. The total statement was in the amount of $782.70, in addition to the $35 deducted initially.

On July 7, 2005, I received a second MPI statement by mail which claims that I didn't process ANY charges through MPI and was charged the $25 minimum charge penalty.

This company needs to be SHUT DOWN! To date, I have taken the following actions in order to educate as many people as possible and try to protect my credit history:

I filed report with the FTC. Everyone who has had these experiences with MPI needs to do this. They can file a lawsuit against the company. If you are a business, call the FTC at 1-877-382-4357 and file a complaint over the phone (the online complaint is only for consumers). They will give you a reference number that you can use in the future to add additional information.

I contacted ABC affiliate in DC Channel 7 On Your Side and Ross McLaughlin. He interviewed me and another local business owner for a program which aired on July 12, 2005. Most local affiliates have these type of public service programs call them! Let your voice be heard through the media.

I filed a claim with the Better Business Bureau. So far, I haven't received a written response from the BBB, but it can't hurt.

I contacted all three credit bureaus (Equifax, Experion and Trans-Union) to place a 90-day fraud alert on my Social Security Number. If they have your personal Social Security Number, you should do this and regularly check your credit report.

Please speak up! The more people who do, the more likely the FTC will take action. Power in numbers!

Htoo
Montgomery Village, Maryland
U.S.A.