ebacher

I am an American living in London for two years and I have lately been noticing an increase in the shops and restaurants that ask you which currency you prefer to pay in - in my case pounds vs dollars. I just want to warn people to always choose to pay in British Pounds because it will be cheaper for you this way. When the shop or restaurant converts it for you, they do so with a higher exchange rate, so you are effectively paying an extra 3 to 5 percent (or more!) for whatever you purchase. Yesterday on Portobello Rd I bought something and I wasn't even asked which currency I prefer to pay in. The salesman just went ahead and charged me in dollars, leaving me to pay an extra 3.5 percent for my merchandise. I will be paying him a visit today to tell him I believe it is illegal not to give the customer a choice. So please do pay attention out there. Otherwise I adore London!

xyz123

This is a malignancy called dynamic currency conversion or dcc. We have discussed this constantly here. Very simply put, both MC and Visa allow merchants to do this, only with the permission of the customer. It is a SCAM because, as noted, the scamming merchants use an exchange rate far higher than mc/visa do and then to add insult to injury, many banks charge you a foreign transaction fee anyway.

If any slip shows both a local currency amount (in this case sterling) and the currenchy of the credit card amount (in this case USD), they are pulling this scam on you. Do not sign the sales slip. Tell them they are not allowed to change the currency without your permission and they are to void (not credit) the transaction and do it properly. At least, there is probably not a language problem here; at least for you. They may lie to you, tell you things like transactions cannot be voided (of course they can, what happens if the merchant accidentally or on purpose punches in an incorrect amount, happens all the time sometimes accidentally sometimes on purpose), they have no control over it, the terminal does it automatically (because of these mc/visa regs, the terminal asks the clerk if the customers wishes to pay in local currency or in the converted currency), that the amount is not the official amount but is just shown for your convenience (oh yeah, tell the clerk then why am I being asked to sign a statement that I agree with the conversion amount). If this fails, ask to see the manager. If this fails, circle the local currency amount, write in the signature panel local currency not offered, and tell the clerk you will be disputing the charge and when you get the bill, do it. For the most part, up until now, the chief culprits in this scam have been Ireland, Spain and Italy. But like any malignancy, it is spreading throughout the world. It must be stopped as it is one big scam.

BTW, Amex does not allow merchants to pull this scam. Perhaps one of the reasons some merchants refuse to honour Amex.

flanneruk

"I believe it is illegal not to give the customer a choice."

If a foreigner came into my shop and told me I was breaking my country's laws, I'd tell him he didn't know what he was talking about.

If that foreigner then said he "believed" I was breaking my country's laws, I might restrain the temptation to punch him on the nose just long enough to ask him whether he had the faintest idea what he was talking about.

I strongly suggest you find some evidence for your assertion before making it. I think you'll find there isn't any.

Dynamic Currency Conversion might be unethical. But,in England, it's perfectly legal, and there's no legal requirement to offer a choice. Whether the card company imposes such a requirement on merchants (and whether, if it does in another country, such a requirement is itself legal in England) is another thing altogether. But I'd strongly recommend you consult K&C Trading Standards, or your local Citizens' Advice Bureau, before confronting the merchant with an unfounded assertion.

xyz123

Flanner...

In this case, we've discussed others, I believe the merchant agreement takes precedent. I don't think English law allows dcc without the permission of the scamee contrary to the regulations, which the merchant accepts as a condition of accepting the card, of mc/visa.

But if legalities just go to what is and isn't permitted by law, I wouldn't use the term illegal. It is simply a practice contrary to the merchant's agreement voluntarily I might add signed by the merchant.

Now in all due respect to you, if you can show me anything in English law that specifies that mc/visa cannot impose said requirement on the merchants, then I will retract my statement. (And of course, if you wish to do so, try to do it civilly in an even tone the way I do!) Until shown a specific English law allowing the practice, I will stick with the idea that mc/visa do indeed allow the scam but it can only be done with the scamees acceptance of the scam.

xyz123

...or are you saying Flanner that in English law, the merchant is always right and that if they wish to aset up different prices, say for right handed people and for left handed people, they are allowed to do so?

Just wondering.

ebacher

Sounds like you have perhaps a vested interest in this scamming behavior. Are you a shopkeeper by chance? I do see your point about making sure it is in fact illegal before I suggest it - but do you really believe I should simply allow anyone to add the currency hike at will without going back in to have them re-do the transaction, as the previous post suggests?
Actually, at the bottom of the receipt was given, it says something about being given a choice in matter. Also, I even discussed the matter with the salesman and he insisted it was the proper exchange rate. I simply was in too much of a hurry and later found out that he lied and did break the rules of his own printed receipt. I am sure he will be happy to re-do my transaction the proper way, in pounds!

xyz123

Just one other thing and I will shut up....Flanner while you have often said you would never travel to the USA because of the idiotic practices the US has adopted to discourage visitors, I am sure you have had holidays say in Ireland or in Spain. Have you ever had the dcc scam pulled on you? And what was your reaction when they did? Did you say, sure go ahead and rip me off for an extra 5% or more or did you follow the procedures we have outlined here?

Just wondering.

xyz123

ebacher...

Here is something you should be aware of because you are a day late...there is a difference between voiding a transaction and crediting a transaction....when a transaction is voided, it is as if it never happened. When a transaction is credited, a new exchange takes place. And what the banks and dcc both do is they add on their fee to a purchase and subtract their fee from a refund.....

But let's have Flanner tell us how he would react if somebody tried this scam on him in Ireland and/or Spain. He seems like a fine chap, always willing to be very pleasant with people. I am sure he will smile at them, and say since he is a guest in their country, he will gladly pay the extra fee as he understands the merchant is always right.

ebacher

It seems obvious to me that it is illegal because at the large shops they make a point of asking you which currency you'd like to pay in. It is only the small places that have always tried to sneak it in. Plus the statement on the bottom of the receipt proves that the customer should have the choice. I will certainly find proof of illegality now, inspired by people like Flanner.

ebacher

Yes, so true xyz! I'm sure he'd be happy to foot the bill! Thanks for your good advice. Wish I'd known about this whole thing. I am a bit new to Fodors.

hetismij

I have experienced this in the US too. One time we ended up accepting it, simply because it was easier than trying to sort it out with the owners of an Indian restaurant who barely spoke English. It actually worked out only very slightly more expensive than if we'd paid in dollars (a matter of €0.05 actually). Other times we refused it and paid in dollars.
I have never experienced it in the UK with my Euro CC. Maybe it is something which only happens when dollars are involved. I don't know. Just a thought.
Flanner is pretty up on UK law, so I would expect him to know what he is talking about, in his usual gruff way .

Pete_R

Hyperbole, xyz123's bug bear and personal bun fights aside...

I think the issue might be with the use of the word "illegal".

English law allows shops to accept (or not) any type of payment they like. If the VISA/MC merchant agreement requires the shop to offer a choice of the local currency (which it does) and the shopkeeper ignores this then that would be a civil issue between VISA and the shop.

hsv

These days there are quitwe a few legal assumptions being made on this board. The vast majority of them is plain BS. The reason being that most come from people foreign to the relevant legal regime and who, in most instances, quite likely don't have the foggiest idea about their own legal regimes. They still do not feel afraid of transferring their assumptions to the legal systems of other countries and thus bless other posters with their profound insights. Most posters BTW appear to feel inclined to accredit more credibility to advice from their fellow countrymen in this respect than to that of people who in relation to them would be foreigners.

A general assumption that something is illegal should definitely be backed up by facts rather than mere speculation as ultimately it implies a significant allegation.

I have not come across this preocedure anywhere in London BTW.

nona1

No-one - including Flanner - suggested it was an ok thing to do, so why are you flying off the handle as if someone had said it was?

The only issue was the word 'illegal'. I wouldn't know as a fact if it is or isn't. Nor do you. If you go in spouting about 'illegal' and it isn't, you'll just make the situation worse for yourself. That was Flanner's entire point.

Against the credit card company rules? Oh yes, absolutely.

Anyway, if you've lived here for 2 years why don't you get a UK bank account and card, then this issue won't arise?

kerouac

I must admit that the "illegal" word often ticks me off as well. Working for an airline, I am often told that an airline is doing something "illegal" when in reality it is just not respecting IATA regulations. IATA does not have the power (or the desire) to make laws, so it's just a question of warning the airline or removing it from the organization if the problem is serious.

It's the same with Visa and MasterCard agreements.

xyz123

Okay...so we all agree. We'll drop the word illegal. But dcc is still a scam pure and simple and you have every right to follow my simple procedure listed above. Incidentally, I have had to do this several times and instituted charge backs with the credit card companies and won every single time (not that it's been dozens of times)...but as I say my name is Tucker. It's not Sucker.

Iowa_Redhead

Just on a side note... not all merchants who offer to charge in dollars instead of pounds are doing it to scam you. Many of the people actually running the cash registers likely don't know that you end up paying more and are trying to be helpful.

The manager and/or owner likely understands this, but please don't get mad at the cashiers for offering it. A simple "local currency please" should suffice, and if they push then politely explaining that "it actually costs more if it's converted to dollars at the store so thank you for trying to be helpful but local currency please" should really fix the issue. Worst case is that you write on the slip (yours and theirs) that local was not offered and challenge it when you get home. There's no reason to get upset and call it illegal or get pissy about it being a scam.

nancicita

Someone mentioned how to write "local currency not offered" on the sales receipt. Could someone please kindly post this procedure and let us know if it works?

xyz123

Iowa Redhead...

Yes I agree the clerks are just doing what their bosses tell them to do...note I said ask politely in my first response.....but it is a scam....the shopkeeper knows it's a scam...the credit card processing company who sells him or her the idea knows it's a scam; somebody has to be training them since they all use the basic 3 lies I noted above (just a convenience to show the approximate amount, cannot void the transaction once done, I have no control over the terminal)...it's that I keep hearing these same lies that makes me think that they know it's a scam.

But we all don't have to quibble over this. So let's all agree, it's obvious legal as mc and visa allow it provided the scamee gives permission, as such it is not a violation of the law so it is not illegal but it is contrary to the merchant agreement.

BTW I have heard from some of those who push this that many customers wish to know the exact amount they are being charged and fine the service helpful to them and the small fee is for the price of convenience. So I put it out there, is there anybody here who thinks the price of convenience (8% to 10%) is such that they prefer charges be written up in their currency ratheer than local currency? Have never met anybody who thinks that way, at least not yet.

Vicky

In Switzerland they always asked which currency. I instructed my friend traveling with me to always say Swiss francs. The shopkeepers never tried to argue with us. However, in London at Harrods before I knew about this, they charged me in US. Luckily it was a small amount -a blown glass London phone booth Christmas ornament.