NCIX Charging Credit Cards Without Shipping Products

Does anyone know what the laws are in Canada surrounding charging a customer’s credit card when you don’t actually have the product to sell them? Back at the beginning of March I ordered a Trendnet KVM switch from NCIX. They had the product I wanted listed, so I placed my order and they charged my credit card. A few weeks passed, and I emailed them to find out where my product was – and I was informed that the product was on order. I was a bit perturbed because there was no indication that the product would take 2+ weeks to arrive, but I needed that one specific product so I waited. It was just today, nearly six weeks later, that I decided to contact them again, and this is what I was told:

“We had been on backorder for this item, and we had yet to receive any stock since you placed your order. However, after checking with our suppliers, it appears that this item has been unexpectedly discontinued. Unfortunately, this means we will be unable to get this item in for your order. At this point you have the option to either change your order to another item, or have the item cancelled for a full refund. Please contact us back to let us know how you wish to proceed with this order.”

Products get discontinued – that’s no NCIX’s fault. But why on earth would they charge my credit card if they weren’t buying the product from the supplier? There was no indication that this was a special order – the kind where you pay in advance and they order the product in – so it seems ethically dubious for them to take $50 or so from me, hold on to it for six weeks, then inform me that the product actually can’t be ordered.

I think I’ll be avoiding NCIX for a while… 🙁

  • jedikitty

    Jason,
    I know it has been a long time since you posted this but seems nobody answered; at least I don’t see a reply to your blog entry 🙂
    So, while while trying to resolve this very same question, I contacted the legal expert online and the answer I received was this:

    “Usually companies would not charge until they ship but it would depend on the kind of business. If they are a catalogue retailer they would advise you of the backorder before the charge. However some smaller online retailers will process the charge (but would be obligated to refund if you cancel the order due to the backorder).
    Were you advised that the order was backordered before confirming the order?
    If you want to back out of the order because of the backorder and they are non-cooperative, I would contact your credit card company and have them investigate.

    Technically speaking its not illegal its just poor business practice (because if you back out of the order they have to refund you the cash and pay the credit card processor twice – once for the transaction and once for the refund). ”

    Well, there we have it, from the legal eagle online. I know my reply is over a year late but thought if I do post it, it will help other people looking for the same answer (and save them 38 dollars in the process).
    So, here it is, my pay-it-forward and JIT for the credit card charging Christmas frenzy, LOL. Enjoy!

    Hugs,
    jedikitty

  • Thanks for the input jedikiddy!