Bad Business Policy is going to bit them

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Mr Lucky

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To all firearms forum members, FFL's, gun owners and other law abiding citizens.

I have been an FFL for several years. I have used Authorize.net as a merchant services gateway (credit card approvals) for the past two years.

Today they sent me a notice that they were canceling my account. Frankly, I don't care. There are other merchant service gatways who DO want my business.

If you are an FFL, thinking about starting a firearmss business or any other business that usees Authorize.net Please think again.

Attached is my responce (sent to abuse@authorize.net) to their Very Unpersonal Email notice followed by the notece they sent to me. I have changed salutations to my username on this forum. Authorize.net did not have the courtesy to sign their cancellation notice to me.

Dear Authorize.net,

Today I received by EMAIL a notice that you are terminating my account Due to: Service Agreement (the "Agreement") (http://www.authorize.net/files/Authorize.Net_Service_Agreement.pdf). These sections include, but are not limited to, the sale of firearms or any similar product.

I have had this account for two years And you have taken my money for every transaction. My account with you was arranged by Power Pay, 888-888-4009, My bank Processor.

I have informed Power Pay of your anti American Gun policy and your infringement on the Constitutional Second Amendment rights of all Law abiding U.S. Citizens.

Please be aware that the Federal Trade Commission will be informed of you actions to harm my business. The FTC does investigate cases such as this where a paid service provider suddenly changes policy or in your case, got around to reviewing my account after approving it two years ago.

Rest assured that I will be doing my best to inform all 300,000 + Federally licensed gun dealers collectors in the U.S. That it is against your policy for them to be doing business with you and that they should terminate their agreement with Authorize.net and find another Merchant Gateway immediately.

As a Courtesy, I will be sending all licensed dealers a list of Gun Friendly Merchant Services Gateways who do not impose unrealistic restrictions on legal U.S. businesses. This includes a mailing to every Sporting Goods retailer who also sells firearms or ammunition.

My Case will also be brought before NRA-ILA. Millions of gun owners will want to be made aware of ANY merchant who does business with a company who engages in anti American policies that infringe on their Constitutional rights. There are over 4,000,000 NRA members and thousands of affiliates who will be informed of your policy.

Happy Trails,

(MrLucky)

Midwest Shooting Sports and Supply LLC
Website: www.gunsandsupply.com
Email: service@gunsandsupply.com
Tel: 888-745-2080
Fax: 888-745-6635


*** Cancellation Notice***
Your Authorize.Net Merchant ID is: XXXXXX
Dear MIDWEST SHOOTING SPORTS AND SUPPLY, LLC,
Authorize.Net LLC ("Authorize.Net") has determined that the nature of your business constitutes a violation of Section 2.xv of the Authorize.Net Acceptable Use Guidelines (http://www.authorize.net/company/use.php) and Sections 3.4 and 10.3.3 of the Authorize.Net Service Agreement (the "Agreement") (http://www.authorize.net/files/Authorize.Net_Service_Agreement.pdf). These sections include, but are not limited to, the sale of firearms or any similar product.
Accordingly, pursuant to Section 4 of the Acceptable Use Guidelines, your ability to access and use the Authorize.Net Services will be terminated on April 29, 2011.
If you feel you have received this e-mail in error or have any questions about this termination notice, please contact abuse@authorize.net.
Regards,
Authorize.Net Abuse Department
***You have opted to receive Administrative Announcements for your payment gateway account. To unsubscribe, log into the Merchant Interface and click Account from the main toolbar. Then click User Profile from the menu on the left. Select Edit Profile Information and uncheck the e-mail types you do not want to receive. Click Submit to save any changes.

Authorize.Net does not send spam. Ever. For information on Authorize.Net communications and how we handle customer information, please see our Spam Policy and Privacy Policy.

Please do not reply to this e-mail.

Copyright 2011. Authorize.Net, a CyberSource solution. 808 East Utah Valley Drive, American Fork, UT 84003. All other marks are the property of their respective owners. All rights reserved.
 
Regards,
Authorize.Net Abuse Department
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They signed it. Sounds like you and your bank processor that set up the account never read the ToS. Firearms is a tricky business and online payment companies don't like to get involved for liability reasons, not anti-gun reasons.
 
It is just another case of bad business. They were more than happy to accept hundreds of credit card transactions from me and many many other gun dealers who use their service.

There is really no liability for them. They indemnify every transaction. Really all they do is check the card. This is privacy protection for you. I never see your card number. They just tell me that addresses and zip codes match. For really large purchases that could be questionable, I must contact the card company directly.

Most importantly, you as the customer are protected by by a verified secure socket link to the card processor. That is an insurance policy for you. My SSL underwrites my liability for $1,000,000 for every transaction.

A merchant Gateway is really nothing more than a middle man.

On a positive note, this is a sign that our economy is beginning to show signs of life again. When companies such as authorize.net (medium size gateway) can pick and choose, you know things are changing.

The flip side is that this is yet another example of the anti-gun movement upon us that most take for granted.
 
There is really no liability for them. They indemnify every transaction.
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Which is it? If they indemnify every transaction, they are protecting against damage, loss or injury, which sure sounds like (and is legally) assuming liability.
 
Clarification: I meant to write that they Indemnify themselves against any responsibility or wrong doing in their terms and conditions. As usual, this document is in very fine 6pt single spaced type with no paragraphs.

Each merchant statement I receive begins like this:

========= SECURITY STATEMENT ==========
It is not recommended that you ship product(s) or otherwise grant services relying solely upon this e-mail receipt.
 
I'm sorry, but Authorize.net is not infringing on anyones' Second Amendment rights. Even though that rule is rather silly, they are a private business and can choose to not do business with you for any reason. If they don't want to handle transactions from FFL's, that is their choice.

By all means, let other FFL's know about this, so they can switch to a processor that does not have such silly rules.
 
Move on, and find a company that cares for your business.

This address puts them in an area known as "Happy Valley".
Copyright 2011. Authorize.Net, a CyberSource solution. 808 East Utah Valley Drive, American Fork, UT 84003.
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Happy Valley is not named such because of the extremely friendly attitude, and general health of the residents. It is named such, because it has the highest anti-depressant usage per-capita, in North American (the World, at one time).

They're so whacked-out on anti-depressants, they don't even know what they're doing half the time.
 
Jersey,

You are correct. To re-phrase, I might say that this is not directly an infringement of your rights or mine. Rather, I will call it an affront.

Case in point. Many of my customers are from New Jersey and New York. Why? I do sell at fair prices and I do like to shoot the breeze with my customers. Maybe that is the reason.

I think the real reason is that it is not often easy to find what you want in your state. This is because your rights have been eroded by power seeking politicians with an agenda.

Mind you, I can only sell you what is not restricted by your state.

My 2A stance is exactly that of NRA. Not to extreme but beware of those who directly or inadvertently threaten to take our rights from us by imposing anti gun policies.

The gun itself is only a tangible symbol of one of the freedoms that you enjoy for now, even in parts of New Jersey.
 
FrankenMauser,

We will be moving on in the morning. There are other gun friendly gateways. My actual bank processor is in Maine. If there was ever a problem that required a conference call, the 3 hour time difference was sometimes a problem anyway. It wasn't broken until today so I had no reason to fix it.

You made me chuckle as you described Happy Valley.

As I was speaking to one of their reps on the phone this afternoon, I had to ask her to tell her cackling co-workers in the background to pipe down. It wasn't just giggles, they were having a big laugh about something. I wasn't really angry, but was not in the mood. I said to her, "I consider this serious business. Can you do something about the chatter so I can hear you?"
 
We will be moving on in the morning. There are other gun friendly gateways. My actual bank processor is in Maine. If there was ever a problem that required a conference call, the 3 hour time difference was sometimes a problem anyway. It wasn't broken until today so I had no reason to fix it.
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I'm glad you didn't take that as me saying "Move on. Quit being a baby." That's not what I meant.

I was eluding to the fact that Happy Valley based companies often have unpredictable, holier-than-thou business practices. Much of it comes back to the predominant political opinions and religious beliefs, but the anti-depressant usage really makes things worse. ...And makes dealing with those companies almost comical in the Circus-like atmosphere.

Whenever possible, I avoid doing business with companies based in Utah County, and parts of other counties that fall into Happy Valley.

It's too bad North American Arms and (firearm manufacturer I'm forgetting:eek:) are also located in Happy Valley. At least their products are also available outside the twilight zone. On the up side; Barnes Bullets moved out. They're in the safe zone now. ;)

Good luck with your new gateway company, and thanks for the heads-up.
 
I always thought of Utah as a gun friendly state. Missouri being the Show-Me State, lagged behind many other states to modernize firearms statutes and arrive at a concealed carry law that is now considered one of the best. Before that time, those who wanted a concealed carry permit usually obtained a Utah or Florida permit. Those out of state permits were honored in the most states.

I don't know how much religion plays into this if any but politics does. These companies often align with whatever politician will help them with a regulation, a tax break or whatever they need. In turn, they line the coffers of the politician with campaign money in return for "favors."

No, I did not take you to mean move on in a sarcastic way.

This is just business.
In business, I don't get mad, I get even.
 
Never heard of them. Whatever you don't switch to Gpal. They are a nightmare of legal issues and non-payments.
 
I am afraid, Mr. Lucky, that your protest isn't going to really bite anyone. You can go out of your way and inform all 300,000 FFL folks and such, but let's face it, the threat is really pretty empty. At most on gun forums, you probably won't reach more than a few hundred potential FFL holders. Of those, only a few will be using the same service and of those only a couple will care. The mention of the millions of gun owners is meant to give your letter more bite, but it is more like the bite of a toothless dog. The gun trade really is pretty minor on the grand scale to companies like this one.

I have been wholly unimpressed with FFLs and gun buyers shutting down ebay and Paypal with their protests.

They have not infringed on your Constitutional rights. Learn what it means. They don't have to do business with you. This part of your threat doesn't bode well at all. You are trying to make it sound like this is some sort of civil legal matter and it isn't, otherwise, you would not be sending your protest letter and you would instead be suing the hell out of them.

Sorry. I understand your pain, but being upset because you don't like the user agreement just means you need to move on.
 
DNS,

You are mostly correct. From an FFL perspective, it should be evident that this actually has little to do with guns. Of the thousands of sporting goods we sell, firearms sell at a much smaller margin and amount to far less that you might guess.

You might be interested to know that NRA payment alliances also uses Authorize.net. These are facts that investigators are paid to find for smart lawyers.

Actually, the issue comes from the credit industry itself and it is about charge-backs. The thinking is that because the firearms industry is highly regulated, can in very rare cases involve criminal activity so they must be considered high risk. In practice, the firearms industry has a far lower percentage of charge-backs than electronics and books sold over the Internet.


There is no hope to persuade Ebay or Paypal, one in the same. Yes I did max out the statistical numbers for effect. If you don't count C&R's there are only about 67,000 Licensed FFL holders. Even if you eliminate the one person hobbyist FFL.

The tax base in Missouri generated by firearms businesses is over $12,000,per year. Medium tier Gateways like Authorize.net know this. They also know that less than a 1% difference in gross revenue can be disastrous for them.

An anecdotal fact that I recall from a college political science professor several years ago. He described how, in theory, it would be possible to change the outcome of an election simply by persuading your spouse to vote the same as you. Word of mouth advertising can be very powerful.

I don't have a vendetta. I will appeal to them as I normally do by sending them an invoice for website redesign. You might say that is the cost of doing business. It is also how most businesses handle situations. Legal action should never be mentioned during negotiations. In fact it should only be used as a very last resort.

My case is more annoying than legal. FTC will however take the complaint, does investigate and will, in some instances, initiate a class action suit.
 
I am seriously considering using Square Up for my limited credit card business sales. The payment issue has come up a few times a year and I just said I didn't accept credit cards. This might change that. In my case, I will likely be passing on the fee that I pay to the customer.
 
The tax base in Missouri generated by firearms businesses is over $12,000,per year. Medium tier Gateways like Authorize.net know this. They also know that less than a 1% difference in gross revenue can be disastrous for them.
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And so when they cut off gun dealers, they knew that they losses would be insignificant, much less than the 1% (assuming your claim of 1% being disasterous is something actually resembling accurate unlike your made up FFL numbers).

An anecdotal fact that I recall from a college political science professor several years ago. He described how, in theory, it would be possible to change the outcome of an election simply by persuading your spouse to vote the same as you. Word of mouth advertising can be very powerful.
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You are grasping at straws. You have no basis to show where threatening to get FFLs to change will affect the business in any significant manner. You don't even know how many FFLs the company has as clients and as such, you can't possibly know what impact there will be on their business. In theory, your poli sci prof knew what he was taking about. In reality, this sort of theory analogy is pretty meaningless.

I don't have a vendetta.
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You don't have a vendetta? You are going to do your best to tell everyone you know about how mistreated you feel imply that they will all feel your pain and hence drop the offending company on your made up data say-so, hence doing the company harm, but you don't have a vendetta? Do you know what vendetta means? This certainly sounds like you have become the bitter destructive side of a feud.

I will appeal to them as I normally do by sending them an invoice for website redesign
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Do website designs usually start of with grandiose misrepresentative public threats?

Legal action should never be mentioned during negotiations. In fact it should only be used as a very last resort.
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So we have reached the last resort, have we? You have mentioned Constitutional rights infringment (about which you are wrong) and threatened the company with the FTC. Sounds like you have already fully introduced the notion of legal action, especially given you think their could be a class action suit that results.

Since you know so much about the FTC, can you tell me how many times other credit companies have been badgered into submission by this technique successfully that now must take gun dealers as customers? Why hasn't it worked with ebay and Paypal? Citibank? First Data? Bank of America? Compass Bank?

FYI, when you speak for the entire gun community, FFL holders, the NRA, etc., sending empty threats with misrepresentative information to a company with whom you have a beef is pretty damaging to your credibility and looks bad for the rest of us.

FYI, the NRA has already given their best shot at Citibank. They have been for years. Citibank still disallows gun dealers...at least those they know who are gun dealers.
 
I refuse to give money to anti gun businesses. There is an NRA list if you google it. Lots of companies on it. Levi Jeans, Sara Lee, Time Warner, AMC, Hallmark, Ben and Jerry's are a few. :mad:
 
A lot of us already know Authorize.net is a no-no, says so right in the first part of their terms/conditions. This has come up many times on the FFLOnly forum.

We used PAI (Payment Alliance) for a long time because they are NRA endorsed and gun friendly, however they are a little slow. We moved to Payex who fund in 48 hours tops and are a local company.
 
>A lot of us already know Authorize.net is a no-no, says so right in the first part of their terms/conditions. This has come up many times on the FFLOnly forum.

We used PAI (Payment Alliance) for a long time because they are NRA endorsed and gun friendly, however they are a little slow. We moved to Payex who fund in 48 hours tops and are a local company.<

No worry, I have another gateway that only answers to my processor and does not bind me with any supplemental terms and conditions.

In 20/20 hindsight I suppose I kinda sorta shoulda micro managed every task of my website developer. I expected that he knew the drill since he has built several gun websites and programs for one of my distributors.

Not to labor the point but I find it odd that authorize.net is just now getting around to reviewing my account. BTY, even with the cancellation notice, to date, they continue to process orders for me.
 
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