UPDATE 8/14/2021: The Justice Department has charged Michael Mendlowitz and Richard Hart with wire fraud, mail fraud, and conspiracy to commit wire and mail fraud in relation to their operations as executives of Commerce Payment Systems. The Justice Department charges the company with “masterminding a years-long scam that took more than $30 million from more than 10,000 small businesses, who relied upon CPS to help them process debit card and credit card sales,” specifically stating that Mendlowitz and Hart “operated a fraud scheme founded on false claims of very low fees, along with false promises that there were ‘no hidden fees,’ and that rates were ‘guaranteed for life.’ In truth, however, CPS customers were charged all manner of hidden fees, and MENDLOWITZ subsequently altered customer accounts to add even higher fees. Among other deceptive tactics, MENDLOWITZ and HART used a ‘cost comparison calculator’ that ostensibly showed potential customers a direct comparison between what they were currently paying versus what they would pay if they became customers of CPS. However, these cost comparison calculators were intentionally designed to conceal many of the fees that the customers would be charged.” Each charge carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense. According to the same source, a “trial is scheduled to begin in United States v. Michael Mendlowitz & Richard D. Hart on April 29, 2019 at 10:00 AM in Federal District Court Southern District of New York, 40 Foley Square New York, New York.” It is unclear what the final sentences were.
The Commerce Payment Systems website is no longer active, and it appears that the company has closed. We are unable to determine whether this closure is temporary or permanent, but we have ceased updating this review for the time being. A LinkedIn profile for a Michael Mendlowitz names him as the president of Sapphire Capital, but it is unclear whether this is the Michael Mendlowitz who formerly served as CEO of Commerce Payment Systems. If you have any information about the current status of Commerce Payment Systems (including any rebrandings or DBAs), please share it in the comment section below this review.
Commerce Payment Systems Overview
Commerce Payment Systems (commercepaymentsystems.com, commercepaymentgroup.com) is a merchant account provider serving small merchants in most industries. There is some evidence that Commerce Payment Systems is an ISO of North American Bancard. According to multiple complaints, however, the company also does business as Evolution Bankcard, which is a subsidiary of EVO Payments International. It is therefore possible that Commerce Payment Systems is somehow linked to EVO Payments International, but this relationship is unconfirmed at this time. Launched in 2006, Commerce Payment Systems is a registered ISO/MSP of Deutsche Bank AG in New York. Michael Mendlowitz is listed as the CEO of Commerce Payment Systems, which is located at 1465 Broadway, Hewlett, New York 11557.
Customer Reviews & Sentiment
High Complaint TOtal
We are currently able to locate over 90 Commerce Payment Systems complaints that accuse the company of being a ripoff or a scam, and the bulk of these complaints have been posted to the comment section of this review within the last two years. Common themes among complainants include unexpected fees and rate increases, difficulty canceling the service, unavailable or unhelpful customer service representatives, misleading advertising, and expensive equipment leases. Many merchants report an average hold time in excess of 30 minutes when attempting to call Commerce Payment Systems customer support, and there are also reports of disconnected customer service lines. Some merchants report receiving letters in the mail from the company, selling a mystery shopper program. Once customers followed directions on the letter, they had lost anywhere from $1100 to $2700 of their own money.
Commerce Payment Systems Lawsuit
As mentioned above in detail, Commerce found itself on the wrong side of an extensive lawsuit by the US federal government in 2019. This lawsuit appears to have caused the company to close.
Commerce Payment Systems Support Options
The overwhelming consensus appears to be that Commerce Payment Systems does not have capable customer service to manage the many complaints stemming from its sales practices and contract terms. Additionally, as noted above, the company appears to have loaded some consumer protection sites with fabricated testimonials in an attempt to manipulate its reputation among merchants. These factors have lowered its grade in this section to a “D.”
Client Satisfaction Ratings
| Product & Service Complaints | 63 |
|---|---|
| Billing & Collection Complaints | 165 |
| Advertising & Sales Complaints | 30 |
| Guarantee & Warranty Complaints | 0 |
| Delivery Complaints | 8 |
Note: We have adjusted this company’s BBB rating according to our own standards. To better understand why we adjust BBB ratings, please see our Rating Criteria.
Commerce Payment Systems is not an accredited business with the Better Business Bureau. As of this review, the company holds no rating with the BBB and has had no complaints filed against it. This is very likely to do with the closing of the company, as at the time of our last review, it had 266 complaints filed against it in the last 36 months. Of the total complaints, 8involved problems with delivery, 30 stemmed from advertising or sales issues, and 63 cited problems with the company’s products or services. The bulk of the complaints (165 of them) were filed in regards to billing or collections disputes. 103 complaints were resolved to the satisfaction of the merchant, while 148 either were resolved to the dissatisfaction of the merchant or did not receive a final response from the merchant. The remaining 15 complaints remain unresolved. In light of the company’s complaint rate and resolution ratio, we agree with the BBB’s previous rating of “F”.
Card Processing Rates & Fees
Commerce Payment Systems Contract
Numerous merchant complaints have described the standard Commerce Payment Systems contract as a three-year agreement with a high annual fee, a PCI compliance fee at or in excess of $99, a monthly statement fee of $10, an annual fee of $79, monthly minimums as high as $34.95, and other various fees. The company does not appear to charge an early termination fee (ETF), but merchants have reported total annual expenses that far exceed the one-time expense of a standard ETF. In addition, the company’s fraud prevention policies appear to be generating many merchant complaints, as complainants report receiving their funds only after an excessive delay and many complaints. Commerce Payment System’s apparent affiliations with North American Bancard and EVO Merchant Services are likely responsible for some of these complaints about its contract terms. If you have any knowledge of the standard Commerce Payment Systems contract, please leave that information in the comment section of this review.
Bottom Line
Commerce Payment Systems was already a substandard processor according to our rating system before its major lawsuit. It appears that this company very much deserved to be shut down, and it is advised to avoid anything to do with them or their leadership going forward.
Commerce Payment Systems Rating
