I am sophisticated in these matters and annoyed at myself for allowing this to happen, but I was rushing and did not follow my gut instincts which was to throw the guy out. He hid behind the guise of JP Morgan Chase Bank, which appeared to legitimize the deal to reduce our discount rate on credit cards. This is how it happened.
A call came to me indicating that NPMG was part of JP Morgan Chase and had information on our credit card processing volume; could save us money since we may qualify for "wholesale" rates. A letter was faxed confirming an appointment and using JP Morgan Chase Bank on the letterhead. A slick salesman named Josh Carroll arrived. He was much like a used-car salesman.
I was rushed that day, and after his well-thought out sales pitch, and financial calculations showing significant savings, I did a cursory review of the agreement, feeling that their representation (including letterhead) indicating that they are part of JP Morgan/Chase, assured me that the agreement was a standard form and was legitimate. However, the document had some very weird statements, and looked slopppy, which should have sent up the red flag for me. He crossed out some things, but not enough had I spent quality time reading it or had I sent it to my attorney.
We were told that we would need to be qualified and would probably be asked for financial statements, which appeared to further legitimize the deal, causing me to beleive that JP Morgan / Chase (later HSBC - on their letterhead) would be discriminating on who they allowed "wholesale" discount rates. Carroll said, I'm only the sales guy, and the final approval would have to go through their underwriter.
In approximately one week the now infamous credit card terminal box showed up. It was to be part of the processing system we use, but not the primary way of processing for us. We mostly use an integrated computer system that goes through our accounting system and processes automatically. Carroll knew the name of that system and when I questioned him about it, he said it is 100% compatible, and that they do this type of conversion all of the time. Right!
Fortunately, the system did not work, as it did not allow me to use NPMG and "Global" their processor, except on a test basis with their manual terminal - out of the box.
We continued with our legitimate processor for our primary processing, but were shut down for a full day trying to convert to NPG and Global, fortunately to no avail. Additional attempts were made to get the system to operate, all with no success. Eventually, I pulled the plug on their system, after much aggravation trying to make it work, including a software change that they advised was necessary and days of inaction on the part of their "technical department."
In the interim, the first statement from Global/NPMG came in on the "test batch" of the new account that we ran, and was loaded with all kinds of crazy charges by the Global. We have never seen charges on credit card statements like this before. Calls to their office with questions met with voice mail boxes only. No live customer service people in the middle of the work day, so nobody could answer questions about inappropriate charges, already debited from our account.
I am terminating the agreement and challenging it on the basis of damages to our sales and operations, false representations, inoperable systems, and fraudulent statements and representations. Fortunately, I did not make the switch from my legitimate processor.
I will probably be out the money for the lease, but that will be a small price to pay for falling for this phony deal. This is a scam. You think you've seen it all, but you are never too experienced to be conned. Beware.
SteveOrange County, California
U.S.A.
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