program: Chargeback Handling
authority: Mastercard SPME §10.1, §10.3, §10.4, and §11.5
acknowledgement_business_days: 1
lifecycle_states:
  - first_presentment
  - chargeback
  - second_presentment
  - pre_arbitration
  - arbitration
evidence_requirements:
  first_presentment:
    - transaction_receipt
    - authorization_record
  chargeback:
    - merchant_rebuttal_letter
    - delivery_confirmation
    - customer_communication
    - fraud_and_chargeback_data_analysis
  second_presentment:
    - compelling_evidence
    - signed_cardholder_agreement
  pre_arbitration:
    - full_dispute_record
    - prior_correspondence
  arbitration:
    - full_dispute_record
    - arbitration_filing
+   account_data_compromise_investigation:
+     - qualified_forensic_investigator_report
+     - investigation_findings
agent_owner: chargeback_agent
 
- # Added evidence requirement for fraud and chargeback data analysis to address new MATCH reason codes
- # related to excessive chargebacks and fraud ratios as introduced in Mastercard SPME §11.5 update,
- # supporting compliance with chargeback management standards per Mastercard SPME §10.1 and §10.3.
+ # Added new lifecycle state 'account_data_compromise_investigation' with specific evidence requirements
+ # to comply with new Mastercard definitions related to Potential Account Data Compromise Events and the need
+ # for Qualified Forensic Investigators to assess such events, as introduced in Mastercard SPME §10.1 update.
+ # This ensures thorough investigation and proper documentation in chargeback cases involving account data compromises.

Chargeback Handling

Chargebacks are cardholder-initiated disputes against a transaction. Halyard Pay, acting as the acquirer, manages disputes from initial presentment through potential arbitration, adhering to Mastercard's requirements to protect all parties involved. involved, including obligations related to account data compromise events.

Lifecycle overview

Disputes progress through defined phases: first presentment, chargeback, second presentment (re-presentment), pre-arbitration, and arbitration. Compliance with evidence standards and timelines at each step is essential to prevent adverse rulings.

Required actions

1. Acknowledge incoming chargebacks within one business day.

2. Gather necessary evidence relevant to the dispute stage. stage, including any forensic investigation findings if an account data compromise event is suspected.

3. Engage qualified forensic investigators (PFIs) when a potential account data compromise event is identified, to assess cause, scope, and impact, as defined in Mastercard's standards.

4. Submit second presentments when liability is disputable, supported by strong documentation.

4. 5. Escalate to pre-arbitration and arbitration only after issuer rejection of second presentment.

5. 6. Retain comprehensive case documentation for auditing and reporting purposes.

6. 7. Provide all requested documentation promptly to Mastercard during investigations or appeals as governed by sections 10.3 and 10.4 of the Mastercard SPME.

Monitoring and Risk Factors

Halyard Pay evaluates merchant risk using updated Mastercard MATCH Listing Reason Codes, including new, specific definitions for elevated chargeback and fraud concerns:

• Laundering: Merchant presenting invalid transaction records rather than bona fide sales.

• Excessive Chargebacks: Monthly Mastercard chargebacks exceed 1% of sales transactions with total chargebacks ≥ USD 5,000.

• Excessive Fraud: Fraud-to-sales ratio of 8% or more, with at least 10 fraudulent transactions totaling USD 5,000+ in a calendar month.

These clarified definitions, part of Mastercard's updated SPME MATCH Listing Reason Codes (see section 11.5), guide Halyard Pay’s risk assessments and chargeback management protocols to align with Mastercard’s evolving standards.

Source authority: Mastercard SPME §§10.1, 10.3, 10.4, 11.5.