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Yahoo PayDirect Starts Charging Monthly Fees

By Ed Foster, Section Gripes
Posted on Mon Jul 05, 2004 at 12:16:48 AM PDT

It's becoming all too familiar a story in the sneakwrapped world in which we live: an e-mail or a credit card statement arrives and you discover that you're being charged for a service you don't even use. That's what happened to one reader recently when Yahoo started charging a $5 monthly fee on its PayDirect Professional Accounts.

"Apparently I have been swept up by one of the hidden agreements you've been talking about," the reader wrote. "This morning I got a notice from Yahoo that I was being charged a $5.00 monthly fee for a service I was unaware I even belonged to. Apparently when I sent some money to someone via Yahoo PayDirect over a year ago, they kept my name active as an account. Now they have instituted a $5.00 monthly charge and are debiting my account for it."

Yahoo's e-mail informed the reader that his bank account had been debited $5.00 because of a new fee policy that went into effect for "Yahoo PayDirect from HSBC" on June 1. "I think this is unfair," the reader wrote. "I was not given advanced notice of this change, and would not have allowed it. I know I sent something to someone using their service once, but I have not been online with Yahoo PayDirect for a long time and feel I am being charged for a service I am not receiving."

Of course, the reader can cancel the service now, so that one $5 payment is all Yahoo and its banking partner HSBC will get from him. And the same will be probably be true of many other Yahoo PayDirect "Professional Account" users, even those who used the service a little more frequently than our reader. And that raises the question of why Yahoo, which clearly isn't having much luck competing with PayPal in the online payments business, would risk driving away what customers they do have for $5 a month. If you can figure that one out, let me know.
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Yahoo PayDirect Starts Charging Monthly Fees | 11 comments (11 topical) | Post A Comment
Contest the charge[ Reply to This ] (none / 0) (#1)
by tscoff on Mon Jul 05, 2004 at 07:15:57 AM PDT

Ed,

Anyone who got hit with that $5.00 charge with no advance notification needs to contact their bank and contest the charge.  If enough people do that successfully it will give Yahoo's accountants some major headaches and they deserve them.

[ Reply to This ]



Re: Contest the charge[ Parent | Reply to This ] (none / 0) (#2)
by Anonymous User on Tue Jul 06, 2004 at 11:43:36 AM PDT

This is exactly what I did. I also filed a complaint online with Yahoo! and threatened to file a formatl complaint with the Office of the Comptroller of the Currency against HSBC. Yahoo! refunded my $5 after about 2 weeks. The OCC's web page is: http://www.occ.treas.gov/ I had never made a transaction through PayDirect, but I had setup my account. I never received a notice that the account would become a subscription account. My bank notified me that although the transaction was via ACH transfer, the NACHA have rules that allow me to refute unauthorised charges, specifically those that are not authorized in writing. See the NACHA web page: http://www.nacha.org/

[ Parent | Reply to This ]


Yahoo Stockholder[ Reply to This ] (none / 0) (#3)
by Anonymous User on Tue Jul 06, 2004 at 12:00:16 PM PDT

Even though I'm a Yahoo stockholder, I urge every consumer ripped off by Yahoo to dispute any charge with your bank and with Yahoo. In today's corporate world the only way to keep a company behaving ehtically is for the consumers to hit their bottom line by disputes and shopping elsewhere!

[ Reply to This ]


yes[ Parent | Reply to This ] (none / 0) (#11)
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[ Parent | Reply to This ]


I got zapped by yahoo too.[ Reply to This ] (none / 0) (#4)
by pchlpdr on Wed Jul 07, 2004 at 05:39:44 AM PDT

I created a yahoo paydirect account but never made any transactions on it. I also never gave any bank or credit card information either, yet I got a charge to my bank account for their monthly fee. What I want to know is how they got my information without me giving it to them. Does anyone here know the answer to that question? Also, in the past, whenever I wanted to dispute a charge I could go online to my bank account and look up a phone number that the vendor provided in the description. Alas yahoo paydirect saw fit not to provide such information. Does yahoo really think that will slow down search savy internet users? When will these companies learn. How long before we see websites against yahoo like we do for paypal, www.paypalsucks.com and www.paypalwarning.com?

[ Reply to This ]


Re: Yahoo PayDirect Starts Charging Monthly Fees[ Reply to This ] (none / 0) (#5)
by allentate on Thu Jul 08, 2004 at 01:02:53 PM PDT

Call this number and have them cancel your account: 408-349-3335

This happened to me too and after 3 or 4 unsuccessful email attempts to resolve it I found the number to call. Once they get through verifying that you are really you they are pretty helpful. I told them that I was not notified this was going to happen and that I wanted my account closed and my money refunded. Surprisingly enough, they gave me a confirmation number and an email address in which to request my refund and they closed my account.

Now I await my money. :)

[ Reply to This ]



Re: Yahoo PayDirect Starts Charging Monthly Fees[ Parent | Reply to This ] (none / 0) (#10)
by Anonymous User on Wed Nov 03, 2004 at 12:02:10 PM PDT

I want you all to know that it took a couple months but Yahoo! did refund all my money. :) allentate

[ Parent | Reply to This ]


Quite a step backwards...[ Reply to This ] (none / 0) (#6)
by timthechef on Thu Jul 08, 2004 at 04:38:22 PM PDT

This could be a public relations nightmare. It's one thing to slap your customers in the face. It's another to assume somebody is your customer, then walk up to slap them in the face. It's another thing still to do so in a manner that makes you vulnerable to a public backlash. Let's face it, the impact a company feels from a result of its customer service mistakes are directly proportional to how ineffective they are at keeping it quiet. This has the makings of a very public outcry. Tim

[ Reply to This ]


Public Outcry[ Parent | Reply to This ] (none / 0) (#7)
by Mason on Thu Jul 08, 2004 at 09:29:12 PM PDT

I'd like to think so, but I havn't heard about this from any other sources.  

[ Parent | Reply to This ]


Mason...[ Parent | Reply to This ] (none / 0) (#8)
by timthechef on Fri Jul 09, 2004 at 10:48:28 AM PDT

Mason, looks like you may be right. I've been looking at some other forums and blogs and can't find any mention of this. Checks at Google haven't yielded much, either. That's a shame because people should be made aware of "dirty commerce" like this. Tim

[ Parent | Reply to This ]


Yahoo PayDirect charge[ Reply to This ] (none / 0) (#9)
by Anonymous User on Fri Oct 08, 2004 at 01:55:31 PM PDT

Just wanted to let you know that I too have been charged for over 4 months now for the service I do not have or was aware of. When they first charged me I emailed them and asked why and they said that I had a professional account and was being charged for that. I downgraded to the basic account was told that there is no fee for that. Well they continued charging me the fee. I just want to let you know that I called the number that someone else posted...408-349-3335 and they were very nice about cancelling my account and crediting me the money back and also received a confirmation through my email. So if you want to have this taken care of, stop emailing them and call this number. It works!!!

[ Reply to This ]


Yahoo PayDirect Starts Charging Monthly Fees | 11 comments (11 topical) | Post A Comment
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