I got robbed. Chargebacks got my money back.

Getting a refund for your purchase may not always be an option. In the event that you purchased something, attempted to return it and was denied, you can still use a chargeback. In this post we’ll go over chargeback examples to explain how they work.

A chargeback is when you file a dispute with your payment processor regarding a purchase. So if you bought an item or paid for a service using your credit card or PayPal, you would probably be eligible for a chargeback. Of course, not all chargebacks are guaranteed since it can be abused.

A chargeback dispute isn’t the same as how a refund works. Your money is returned to you from the payment provider instead of the seller. Pretty much you’re telling the bank (or PayPal) that the seller screwed you on a purchase and to take the money back from them to return to you.

After making your chargeback claim, the case goes into investigation before determining if your money should be returned to you. The investigation can take months (I’ll explain below) or can be returned immediately depending on the circumstances.

I highly recommend always using a credit card when making a purchase online because you have more protection for your purchases.

Chargeback Vs Refund

A chargeback isn’t the same as a refund or warranty. You already know what a refund is, returning something for the same amount you purchased it for.

You’ll only want to use a chargeback when you try to get a refund for a purchase and it’s not possible. A likely scenario is that you recently made a purchase and didn’t like what you received. You tried to get a refund but was denied. That’s when you can start the chargeback process. The credit card chargeback time limit is 120 days so be sure to start it as soon as possible.

Warranty is one of my favorite things. I know warranty may seem like a scam, BUT hear me out. American Express adds on 1-year of warranty for free on ALL of your purchases. If the item breaks, gets lost, damaged or stolen, you just need to provide some evidence to get your money refunded. This gives me incredible confidence when walking down dangerous streets with an expensive camera…at least for the first year.

Visa gift card from Saples

My $2000 Chargeback on Visa Gift Cards from Staples.com

I used to have the Chase Ink Business credit card that gave me 5x points on purchases through office stores. Essentially, that’s 5% back in the form of cash and even more valuable as frequent flyer miles and hotel points. The cost of buying and liquidating these gift cards cost me around 3.9%. This results in a 1.1% gain from buying gift cards.

That’s a lot of nerdy numbers I’m throwing at you. Basically I was making a small profit and wanted to generate a lot of Chase bank points so I can use them for travel. This process of generating credit card spend at low (or negative) costs is called manufactured spend. That’s a whole different beast that we’ll tackle in the future.

I’ve probably ordered over $50k in gift cards from Staples, but this time it was different. The $2,000 in visa gift cards I ordered took much longer to arrive, about 2 months. I received the PIN numbers in the mail a month before the actual cards. This concerned me while waiting for them to arrive.

When the cards finally arrived, I checked the balances. All had a $0 balance and were immediately liquidated soon after I made the purchase 2 months ago. I was immediately stressed out because $2,000 had just been stolen from me before I even received the cards. But then I started taking steps to recover the money.

The Scam

A month after I ordered the gift cards I received the PIN numbers. This was pretty common and I was expecting to get the actual Visa gift cards in the next few days. They always mail the cards and PIN in different letters. Typically, all the PIN numbers appear in one letter and the PINs for each card are different. This letter showed the PIN was the same for every card I had. That was weird.

I didn’t think anything of it and just waited for the cards to arrive. The cards arrive in individual letters with the card glued to a piece of paper. The card number is always exposed (there isn’t a sticker covering the number). There is a sticker above the gift card number telling you how to activate the card.

Trying to get $2000 back

Staples sold me the card so I got on the phone with a customer representative. I told them the entire story and they looked into the order. They told me that they are just a seller of Visa gift cards and don’t actually mail them from Staples. All of the visa gift card orders are managed and sent by the Blackhawk network.

I then called the number on the back of the Visa Gift Card. It was run by the Blackhawk Network. I explained the situation but they kept saying that their data showed I liquidated the cards even though I HAD NO WAY of having that information right after they were purchased. Someone mailing out the gift cards was clearly stealing the information.

My explanation went nowhere with the Blackhawk Network. The customer service representative acted like this was the first time in history that this has happened. Upon further research, I found on Reddit that this is an issue that other people have had issues with the Blackhawk Network. Just imagine how many people had this issue and didn’t write about it online.

At the end of my call, they advised me to take it up with my credit card company. They kind of said it like, “good luck” in a sarcastic way. Well, that’s what I did. It’s kind of a long explanation, so I just called the Chase bank up and told them the situation. The phone representative was very understanding and began the visa chargeback process.

As a sign of good faith, the Chase bank representative already credited me with the missing $2,000! That’s just so I wouldn’t have to pay any finance charges or struggle financially during the dispute.

Sending in evidence

$2,000 is a lot of money so of course Chase want as much evidence and information I can provide. I had to fill out several forms by hand and physically mail them in. Not e-mail or fax, but an actual letter.

After some back and forth with the letters, I had to speak with a bank fraud investigator. I told them the entire story again and in great detail. He asked a lot of questions that he already knew the answer to. He was looking for holes in my story, but there were none. I was sincerely cheated by the Blackhawk network that sold me empty visa gift cards.

I had to fully explain to the investigator why I was buying the gift cards and what I was doing with them. Luckily, I had an established history of doing this for over a year and an even longer banking relationship with Chase. But if this was the first time I bought Visa gift cards

Getting My Money Back

After a 3-month investigation into the issue and a lot of legal paperwork, I got my money back. That was the last time I ever bought Visa gift cards from Staples. If this happened regularly with buying Visa gift card, I doubt I would keep winning these chargebacks.

There are many scams online about people buying gift cards to pay the IRS that turn out to be a scam. That money is never refunded. I was lucky because this issue happened within the network of the sale.

That entire time, I was missing $2,000 from my bank account. Luckily I had enough money to cover the costs for the time being, otherwise, I would have been hit with finance charges. For those of you that do get hit with a finance charge, here’s how you can get bank fees refunded.

Taipei Studio Apartment $800 USD/month

PayPal Chargebacks Helped me Get a Better Apartment

In November 2018, I sold my home in Los Angeles and decided to travel the world. My first stop was Taipei, Taiwan for 2 months. For the first 4 days, I booked a pretty nice hotel and then would need an apartment. I arrived in Taiwan with no apartment and had 4 days to find one.

I rented the first apartment I saw on my 4th day in Taiwan and moved in the very next day. Obviously, this was a rushed decision and I had no idea what the going market rate was for apartments. I was paying $24,000 NTD ($800 USD/month) for a tiny studio apartment, poor ventilation, and extremely thin walls.

I was getting ripped off

Typical apartments of this size and in this area were going for about $12,000 NTD ($400 USD/month). Essentially I was paying double for being allowed a short term lease. For reference, you can get a REALLY nice studio apartment in central Taipei for $24,000 NTD. No one likes getting ripped off, including me.

At first I thought the apartment was okay, but all the crappy parts of living in a bad apartment began to bother me. The walls were super thin so I could hear whenever people were walking around the building, doors closing and people coughing. Yeah, super thin walls. The room didn’t have a dehumidifier which you absolutely need in Taiwan so the room was extremely humid. I had a notebook that turned soggy. Insects were getting in the room through the drains. But the worst part was the bed.

The bed was foam on the floor. My body would sink through the foam and just lay on the wooden floor. This gave me back problems and after 4 days of living in this apartment, I wanted out. I complained to the landlord about the bed, thin walls, poor ventilation, bugs, and every other little thing. They had multiple apartments available and I wanted something else.

They weren’t very helpful and said I already signed a contract. After a week, I couldn’t stand living there anymore so I had to bail. I began the PayPal chargeback process.

PayPal Chargeback: Terms and Conditions

Luckily, I paid the rent and deposit through PayPal. This is where we begin the PayPal chargeback dispute. PayPal allows you to chargeback transactions up to 120 days old. Obviously, this can be abused so they do have a mediation and investigation team. They want you to work with the seller before having to intervene.

To apply a chargeback through PayPal, you have to make sure you send money to the seller (landlord in this case) as money for goods/services. This will tack on a 2.9% service charge fee, but it’s a small price to pay for having purchase protection through PayPal.

If you send money through PayPal using the friends and family option, you do not have to pay the 2.9% merchant fee, but you do not get that purchase protection. This means you would not be able to file a chargeback through PayPal in the event that you are unhappy with the provided goods/services.

I changed their mind

After filing the PayPal chargeback, the mediation process began. I provided all the information to PayPal about why I am requesting my money back and that the apartment isn’t as good as it seemed. The manager reached out to me and invited me to their office to talk out the issue.

After our discussion, they allowed me to change to a better apartment. And yes, it was actually better. There was a little more space, less noise, and a REAL bed. The previous bed was like a foam placeholder.


From these chargeback examples I hope you learned how chargebacks work. You get a lot of purchase protection when using a credit card or PayPal that you wouldn’t get if you had paid in cash or with a debit card. The key difference between a chargeback and a refund is that you have to use a chargeback when your requested refund is denied.

Always use your credit card when making purchases online: That payment protection is worth it. Also, don’t buy Visa gift cards from the Blackhawk Network: If you need to do manufactured spending to get a credit card bonus, I suggest using Rebate Key and Plastiq. Rebate Key is a platform that allows you to get free stuff from Amazon. You’re essentially buying the item with your credit card and getting refunded 35 days later.

Never Send Money Through PayPal as Friends/Family: Always pay for the service fee 2.9% merchant fee to get the buyer protection when sending money through PayPal. Never send money as “sending to a friend or family,” because you don’t get the PayPal purchase protection.