Bye Bye iBill

[RawAlex]

It's because at this point, sueing them might push them directly into bankrupcy, and then you can be lucky to get 10 cents on the dollar in the end.

Push someone standing on the edge of a cliff only assures that they will hit the bottom.

Alex

[cd34]

Some strange history:

IBill was located in Ft. Lauderdale for a while and I believe shared part of a data center with FirstData (which is the company that has pretty much caused most of the turmoil in the transition).

Way back with web900, there was only one company that would do adult pay-per-call that was large enough and reliable enough to process and make payments to ibill. That company also happened to sell bandwidth and had enough power to say to iBill, use our bandwidth, or you get no 900# processing. I believe it was in 2002 after a total meltdown of one backbone, and the subsequent meltdown of that company's backbone, iBill was able to put pressure on and get connectivity from another company. They have also since moved their data center to West Palm Beach and still buy the majority of their bandwidth from their web900 supplier.

Now, you have the dispute with FirstData, the shuffle to get a new merchant account, the lack of ability to run as an IPSP (this has greater consequences), and the loss of a great many IPSP clients that won't pay to get their own account and the rapid erosion of their client base through non-communication. I have helped many, many clients move from iBill in the last 60 days.

So, lets think about what has happened. They cannot process Visa, the companies that are generating sales are leaving, which gives you the tiny companies that haven't left yet which are not generating enough sales to dilute any chargebacks that are coming in. This turns the scrubbing up, hence, fewer sales get through, the ratio continues to climb. There are only a few ways to reduce a chargeback ratio that I know of, and taking fewer transactions isn't one of them.

So, enter gkard -- a prepaid card that allows people to pay iBill and then they can use that money elsewhere. Stored value cards have been around forever. ePassporte is very similar, just targeted to a different market. Now, years ago with stored value telephone cards, the Chinese government/telco decided to make really pretty cards. People liked these cards and decided to keep them. A little clause in the government required any money on a stored value card to be held in escrow until the time was used before the money could get released to the phone company. What this did was protect the purchaser of that card from the telco going bankrupt and not honoring the card. gKard is non-chargebackable (supposedly), but then the online casinos claim the same thing. Stored value cards hold huge benefits for companies that run them. A stored value card is a 'float' account -- tons of cash sits there that will get paid out, but, at a unknown time. All the while, your money sits there (usually with no interest) and the company that has it must only meet any daily obligations. Consider if 50000 people all leave $30 on their card while searching for a paysite to join. That is $1.5 million that sits in their account until they have to do a payout. Now you see why epassporte is lax about adding a way to withdraw money to a bank account.

If I had to guess, there's a 5 letter word that comes to mind that describes iBill's behavior. The question is, can they break the cycle.

Yes, they are a US company, but, as a US based company, they hold the same values that almost any company has -- and that is self-preservation and distribution of profits. You can rest assured, as every other large company: Enron, Worldcom, NYSE, that the board members and major stockholders are being paid in a timely manner.

Are their actions enough to have a lawsuit filed? Sure. Is it worth your money to do so? You're sort of at the mercy of the information (or lack thereof) that iBill will supply the courts. They will blame the payout delay on anything except their actions, and they'll draw things out until it is either more expensive to have sued, or, hey, sorry, we have no money left. Their lawyers will be better than your lawyers -- that is almost a fact. You can't sue over your lost Visa income since the processing was shut down. In most cases, that comprises ~65% of the signup/rebill revenue. So, you sue to recover the possible mastercard revenue that you haven't gotten + the $350 you paid. Your attorney will probably charge you $350 to file that motion.

What did DMR do before they shut down? promised payouts that kept moving further and further back. ABM? 6 months of taking transactions without paying. Epoch? I remember a time when they dumped the small guys and set up a $50k deposit/no reserve account. Not sure what they considered that $50k if it wasn't a reserve. Digiblaze? He took his money and ran (and his top guy, also ex-dmr is now an ibill guy). Websitebilling? moved to a bearer-share island and shut down without warning. Globill? moved to the same bearer-share island and shut down.

However. IBill still has a considerable Transaction Processing business for people that have merchant accounts. They have a somewhat substantial non-adult client base and if they were to get rid of the liabilities of the worst offenders in the adult side, could effectively do IPSP again. The smart move is to do almost what Verotel did. You can IPSP until you hit $1k/week. Then, they keep the better quality transactions in their pool and move the bigger guys to TP which again helps. And so far, iBill has only been ~60 days behind, and have started communicating. When a company stops communicating, that's a danger sign.

There are chinks in the armor of every processing company out there. You can read a lot into their actions and inactions.

Personally, I feel iBill will come through it, but, they are losing a considerable benefit from the lack of IPSP processing (and its not just the money)

iBill has made some really dumb mistakes, but, its easy to see that in hindsight. The whole problem really stemmed from an assumption. My recommendation, which certainly isn't in iBill's best interest, is to move to another processor. CCBill/vscrub and Paycom/Epoch/epassporte are two IPSP processors that seem to still be standing fairly strong. Netbilling would be the choice if you wanted to get your own merchant account.

I have also had clients that have used other processors like ikobo and a few others, but, its just a matter of time before those reins get tightened up on the ones that are skirting the issues.

I know this is just a long rant that barely skirts the last question. In short, I don't believe that suing iBill will result in enough gains for it to be worthwhile. Unless you can easily prove willful negligence on iBill's part -- and as an independent observer, I don't believe you can easily find that -- then the case will do nothing but recover costs and income earned.

Move on. If iBill gets caught up, use them as a secondary or backup if you want.

You could file in small claims court in Deerfield Beach, FL if the amount is <$5000 (I think that is the limit)

Not really what you wanted to hear, but, I'll bet that any efforts to recover the money will be met with brick walls every step of the way.

[cd34]

It occurs to me that I am looking at this from one standpoint -- that of a sponsor site.

If you are a revshare webmaster, then I think you are pretty much out of luck. Since they stopped processing Visa, they never collected the money. That money is probably not going to be recoverable. Visa Rebills/New Signups -- those are probably gone.

As far as the rest, if you have a Revshare account and the sponsor you are promoting isn't taking Visa, you're losing out on a fair number of sales. Move on.

Its your income -- you need to do what is in your best interest. If your revenue stream is cut, get another one.

or something like that.

[selena]

Originally posted by Ramster

Selena, you are an affiliate I assume and are waiting for affiliate payouts?

That is a correct assumption, Ramster, and I'm still waiting.

I'm just thankful that they only owe me slightly over the minimum payout.

One of those rare times I can be thankful that I had sucky sales.

[Jan Barnes]

Now the ibill main page states "Another update regarding the RevShare payout will be posted by Wednesday - December 22th, 2004". Yesterday, it quoted December 21.

Do you think they have a JAVA script or something installed to update the date on an ongoing basis (always make it one day ahead)?

[neticule]

Originally posted by janhoo
Now the ibill main page states "Another update regarding the RevShare payout will be posted by Wednesday - December 22th, 2004". Yesterday, it quoted December 21.

Do you think they have a JAVA script or something installed to update the date on an ongoing basis (always make it one day ahead)?

Probably LOL, atleast until holidays are over.

[Jan Barnes]

"The purpose of this communication is to provide an overview of iBill’s current status.

In light of the financial situation due to issues with our previous processor, difficulties have been encountered recently in regards to payouts and promissory notes. We understand the uncertainty these difficulties present to our clients. This was not our intention and we want to inform our clients that we ARE moving forward. iBill has been processing for over nine years and we continue to be committed to the industry. All decisions made are to ensure the long-term viability of iBill and allow for clients to be paid on all monies owed.

We understand that we have made commitments which have been unfortunately delayed. We are currently working to secure capital which will assist in bringing payouts back on schedule. In addition, progress is being made in negotiations with our previous processor for the release of funds. These funds will be directly paid out to our clients.

Please bear with us as we work through these issues. Be assured that we will be back on schedule shortly and these issues will be behind us in the near future. Please continue to check CMI for further updates as they become available".

Latest news as posted by Ibill. In addition, the September 22 check they sent me bounced. Since I cashed it in Europe, I only found out about it a few days ago. Merry Christmas!

[Greenguy]

I got a check from iBill today

[Jan Barnes]

Greenguy,

It is great to see the people at iBill are back in business. It appears that checks were sent out in the beginning of January to everyone.

Cheers!

[Greenguy]

The date on mine was Jan 14th or something like that. I have no idea what period it covered & I only got one (I'm signed up to a lot of iBill programs & most owe me money)

I guess we're in the old "Wait & See" mode now.

[Ramster]

You got an ibill check? Wow. I hope I get some. They last time they paid affilates was for Sept 15.

[Jan Barnes]

Ramster,

New Revshare checks have been sent out, that is the good news! If you log into ibill, you will see the following messages:

RevShare Payout Check Dates 12/08/04 & 12/22/04
Please be advised that the RevShare payout for check dates 12/08/04 and 12/22/04 was processed and paid on January 5, 2005.

The statement for these check dates is currently visible in CMI. RevSharers can go to the Accounting section of CMI and select check date 12/22/04 to view the details of this combined payout.

Payout Update
iBill continues to make substantial progress and we are close to putting our September 16, 2004 problems behind us.

To this end, iBill has obtained an investment from a New York fund management company. We received the first $2 million installment this week.

It is our sincerest intent to ensure all of our webmasters that are processing with iBill are kept current on funds owed going forward.

For Wednesday, January 5, 2005, the following payouts will be made:
12/08/04 RevShare Payout

12/22/04 RevShare Payout

For Tuesday, January 11, 2005, the following payouts will be made:
12/15/04 US Payout

12/19/04 EU Payout

[Greenguy]

So no word on the money from October & November? Nice.

[Bell]

Originally Posted by Greenguy

So no word on the money from October & November? Nice.

ditto that...

I had early on in 2004 earmarked my Oct. and Nov. checks to pay for the construction of a 2 car garage... doesn't look like I'll be breaking ground on that this Spring without the Oct. and Nov. checks...

grrrrr...

~Bell

[GeorgeTH]

They now have the attention of main stream newspapers [19th of January]:

http://www.newyorkdailytimes.com/home.htm?m=ibill and get compared with Emron...

[Jan Barnes]

Originally Posted by GeorgeTH

They now have the attention of main stream newspapers [19th of January]:

http://www.newyorkdailytimes.com/home.htm?m=ibill and get compared with Emron...

This article states the following:

"Initially respected, iBill has become the most reviled, despised, mistrusted, and suspicious companies on the Internet, with business practices reminiscent of Nazi Germany".

Comparing iBill with nazis? Interesting comparison. Exaggeration is fun sometimes, but that is just silly.

[Ramster]

Great, just we need Gearge.

I haven't received any of my checks yet. Being in Canada I expect it later as the admin does show a check so there is hope. (3 checks actually from various accounts)

[vicki]

webby posted this link on another board and I thought it contained enough relevant information to post here also

talk about to-the-point reporting .. I think that reporter must be from texas! lol

anyway, heres the link:http://www.oregonherald.com/home.htm?m=ibill

[chilihost]

that article is wild, I can't believe any professional reporter would write something like that...hopefully it will result in a bit of publicity and maybe, just maybe, ibill will take it as incentive to start paying out their webmasters!!!

cheers,
Luke

[vicki]

yes, quite eloquent wasn't he lol

talk about shooting from the hip!!

[Ms Naughty]

I wouldn't say it qualified as objective reporting. And while the reporter goes on about how they did a lot of "investigating" it's very light on for serious facts.

Nonetheless, I finally did some checking on my iBill affiliate accounts. Up until now I figured it was like Globill and I just had to write off the small amount of money owed when it first went pear shaped.

Still, the rebills have kept coming in, but I haven't had a check from them since 22nd Sept 2004 and I now have a few hundred dollars that are owed me.

GG said he got a check from them the other day. Hopefully the usual airmail delay will explain things and I might see some of my money...

[cd34]

To my knowlege, there have been two payments since Oct 1. One in mid december, and one around the 5th of January. The claim is that the 5th of January payment was a 'current' payment and that they were going to work on staying current.

There was nothing said about old monies that were owed other than there were monies that were owed.

While significantly different than the pump n dump of websitebilling or globill, it does have strange parallels with some of the backchannel stuff.

The downside is that the longer it takes, the more their customer base erodes, the fewer transactions they can blend to keep a reasonable chargeback ratio. This means scrub gets turned up, and its harder and harder to push sales through until one day, not enough transactions can be pumped through, the bank closes the merchant account, the funds are held for 6 months and then released -- usually to an offshore bearer share entity.

Enron kept the balls in the air for quite some time too.

[Opti]

Funny how that "reporters" name doesnt seem to exist anywhere else on the web

http://www.google.com/search?q=%22Lawrence+Kiminski%22

Weird article... leaves himself open for charges of only giving half the facts the way he goes on about all the poor mom and pop businesses being hurt... I doubt that angle will bring a lot of support if the public read it as mom and pop porn operations.

[selena]

I've not been paid by them since Sept., and I can no longer login to cmi, either. I use roboform, so I'm not hosing up the login attempt.

It says I am an invalid user.

[Greenguy]

CCBill checks came yesterday.

iBill checks, which usually come on the same day, did not come yesterday or today