Contracts & The Electronic Funds Transfer Act
Date: Fri, 11/13/2009 - 10:42
My boyfriend owns a small business, he is leasing two credit card machines for his business (a three year contract). They automatically deduct the rent for these machines monthly ($119.00) from his business account, plus additional fees depending on how much the business uses the machines, it's a percentage.
Anyway, his business was WAY down this year. We decided to revoke this companies right to debit his account and make the payments with a paper check, that is until he files BK.
I sent the revocation via email, the response we received was;
Quote:
My response was;
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Ugh! Probably not a good move on my part. Can they cancel the contract because we decided to revoke access to his account?
Anyway, his business was WAY down this year. We decided to revoke this companies right to debit his account and make the payments with a paper check, that is until he files BK.
I sent the revocation via email, the response we received was;
Quote:
Please be advised we received your revocation request and as such the account will be closed and forwarded for collection of the contractual early termination fee ($495 for credit and $100 for debit services) as outlined in the attached Merchant Application & Agreement and Merchant Processing Terms & Conditions. |
My response was;
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Please review the EFTA below: § 913. Compulsory use of electronic fund transfers No person may-- (1) condition the extension of credit to a consumer on such consumer's repayment by means of preauthorized electronic fund transfers; I did not request that my service be terminated, only that I am revoking preauthorized transfers by your company, |
Ugh! Probably not a good move on my part. Can they cancel the contract because we decided to revoke access to his account?
Skydiver probably knows. FWIW, business credit & collection laws
Skydiver probably knows. FWIW, business credit & collection laws differ from personal.
Quote:Originally Posted by unclewulfSkydiver probably knows. FWI
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Originally Posted by unclewulf Skydiver probably knows. FWIW, business credit & collection laws differ from personal. |
Oh well, if they cancel the contract - so be it.
I spoke to the FDIC office and they referred me to the consumer
I spoke to the FDIC office and they referred me to the consumer protection division in Idaho. Apparently they can cancel the contract legally- and I have no recourse. Ugh!
its probably a regular step for them. they are quite aware that
its probably a regular step for them. they are quite aware that the first step towards non-payment is revoking auto debiting. im sure theyve seen it a hundred times before. as such im sure they have their legal duck in a row on the matter. tough luck.
Quote:Originally Posted by Anonymousits probably a regular step
Quote:
Originally Posted by Anonymous its probably a regular step for them. they are quite aware that the first step towards non-payment is revoking auto debiting. im sure theyve seen it a hundred times before. as such im sure they have their legal duck in a row on the matter. tough luck. |
I figured as much BUT, I thought (just a thought mind you) that a contract couldn't be canceled just because the customer chooses an alternative way to make payments. It just seems redundant to even have an EFTA in place if the only purpose it serves is to stop access to your account. Interesting that companies offering a service can have these types of policies legally, seems like it would limit their customer base?