What must an Atwell Suites franchisee reimburse the franchisor for regarding chargebacks?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
You are responsible for all Chargebacks, Third Party Based Fees, Servicers Fees, and other amounts arising from fraudulent activity processed through your Merchant Systems and/or your Merchant Account (regardless of any AVS response that you receive).
- 4.8 Costs. If you or a Merchant Provider (or other Third Party used by you) are determined by any Card Organization, regardless of any forensic analysis or report, to be the likely source of any loss, disclosure, theft or compromise of Cardholder data or Card transaction information or are determined to have caused Cardholder data to be put at risk (together, "Compromised Data Events") and regardless of your belief that you have complied with the Card Organization Rules or any other security precautions and are not responsible for the Compromised Data Event, you must promptly pay us for all related expenses, claims, assessments, fines, losses, costs, penalties, and Issuer reimbursements imposed by the Card Organizations against us (together, "Data Compromise Losses").
In addition to the foregoing, you must also pay us promptly for all expenses and claims made by Issuers against us alleging your responsibility for the Compromised Data Event, apart from any claim procedures administered by the Card Organizations.
We agree not to pass through to you any amounts imposed upon us by the Card Organizations in connection with our Data Security Event.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to Atwell Suites's 2025 Franchise Disclosure Document, franchisees are responsible for all chargebacks and other amounts arising from fraudulent activity processed through their merchant systems or accounts. This responsibility applies regardless of any AVS (Address Verification System) response received.
Furthermore, if a franchisee or their Merchant Provider is determined by any Card Organization to be the likely source of a data compromise event, they must promptly pay Atwell Suites for all related expenses, claims, assessments, fines, losses, costs, penalties, and issuer reimbursements imposed by the Card Organizations. This obligation exists regardless of the franchisee's belief that they complied with Card Organization Rules or other security precautions.
In addition to these costs imposed by Card Organizations, the Atwell Suites franchisee must also promptly pay Atwell Suites for all expenses and claims made by Issuers alleging the franchisee's responsibility for the data compromise event, even apart from any claim procedures administered by the Card Organizations. However, Atwell Suites agrees not to pass through to the franchisee any amounts imposed upon them by the Card Organizations in connection with Atwell Suites's own data security event. These chargeback and data compromise responsibilities highlight the importance of robust fraud prevention and data security measures for Atwell Suites franchisees.