- Tonight, small businesses beware ` the hefty fees taking traders by surprise. - I now owe $6700, and they've taken over $4000. - Plus, a power bill in the thousands ` the charges this flat never expected. - It just screams uh-uh. - And why this home handyman came to Fair Go over two little pieces of plastic. - That's it ` game over. Yeah, that was the end of my waterblaster. - Tena koutou katoa. Welcome to the show. It has undoubtedly been a challenging time for small businesses ` they're battling the fallout from Covid, a recession and extreme weather events. - Mm. Yes, the shop owners in our next story signed themselves up to a well-known online shopping platform, expecting a raft of new customers. - What they didn't expect was an influx of fraudulent purchases and some hefty fees. Star has the story. (THE PRETENDERS' 'BRASS IN POCKET') - Two Kiwi businesses hours apart, but connected by a common struggle. How much do you owe? - All up, three and a half. So, I now owe 6700. - It was a blow after this. But this story's about a storm of another kind ` a flooding, if you like, of fees, credit-card-transaction fees charged on online orders that these businesses say they shouldn't have been charged for because those orders were fraudulent. (NETHERWORLD DANCING TOYS' 'FOR TODAY') - Karan Gregory owns Contain Boutique in Whangamata. - It's my whole livelihood. 10 years of extremely hard work. - The past few years particularly hard. - People don't wanna come here and get stuck here. - Online orders now a necessity. - It's probably, at the moment, 70% to 80% of our business. - But that's opened Karan's business up to online fraud. In 2013, Karen signed up to Shopify,... - Build it on Shopify. - ...an e-commerce platform brands like Netflix, Tesla and Kim K SKIMS use to set up and sell their stock online. - It appeared to be the leader in website platforms. So I don't think I even gave it a second thought. - Until this year. In May, Karan got a flurry of online orders from Saudi Arabia, ranging from $1000 to $4000. They were flagged by Shopify as high-risk, meaning they could be fraud. Once flagged, Shopify says it's up to the merchant to decide whether to fulfil it. - So then I'm having to try and cancel the order to bring my stock back. One night it affected 160 products. - She thought stock levels were her biggest issue. Then the fraud floodgates really opened. - At this stage, they were coming every five to 10 minutes, all night. (CHUCKLES) 3 grand. 4 grand. 3 grand. 4 grand. So in one week, it was over $400,000. - Wow. - It was insane. It was crazy. - Karan went to Shopify for help. She says communicating with the platform was difficult. - There's no phone numbers. There's no email addresses. And any time you needed something from them, you're literally going, 'Oh my God. I have to jump on this little chat box.' - The solution? - Shopify, right. We have all these apps you can download that block fraud. That didn't work. They said, 'OK, try this other fraud block app.' Then I got an order from Noeline in Queenstown, and it cancelled her order. I was just, like, 'Oh my God, you're killing me.' (CHUCKLES) So again, I felt like the app didn't work. - Three hours south in Taupo... - It's your lucky day. - Kate Kerr also received a mass of fake orders on Shopify at her business, Paire Shoes. - And I had a week of 30, I think, all up, but it totalled 100,000. - Her website developers, Legend Taupo, communicated with Shopify on her behalf. Like with Karan, Shopify suggested downloading some fraud-protection apps. - After a week, I was still getting them. - OK. So not a solution after all. Fair Go asked Shopify about these apps. - Shopify offers a selection of more than 100 third party fraud-protection apps in our app store that merchants can decide to install to protect themselves against fraudulent transactions. - But the fraud was only part of the problem. - Then came the fees. - Well, how much were they charging you? - So, I now owe 6700. - How much do you owe Shopify? - All up, three and a half. - And how much have they taken so far? - 1400. Yeah. So, you know, it's a bit of money when you haven't sold anything. - Fees were automatically deducted from their accounts with each fake order. Karen's already been charged $4000. And remember, the fraud apps didn't work, leaving them wide open to further fake orders and more fees. So what are these fees? And why are Karan and Kate having to pay them? - These are transaction fees charged by Shopify to process major credit cards as payment via a merchant store. Merchants don't pay any fees to the credit card provider itself as the Shopify payments transaction fee covers this for them. - So fraudulent or not, fees are still charged. Shopify's terms of service do say there's no refunds. But is this legal? - Yes, it is legal. - But is it fair? - No, it's not fair, but fairness and law are two separate things. I was expecting, when I read it, to think, 'Will I have to wade through it to try to work out what's going on?' But it was clear. - Karan admits she didn't read the fine print properly. But... - I feel like you just trust. You trust this worldwide platform. - But Auckland University Associate Professor Alex Sims says Shopify doesn't have to charge these fees. They could fit the bill themselves. And if these orders are flagged as fake, they should make more of an effort to stop the fraud. Shopify told the businesses... - READS: Shopify is not blocking high-risk orders as the decision about how to proceed with these is the business decision of every merchant, and we can't interfere with this. - So they've paused my website their end too, until I pay the last bit of the fees. - Yep, that's right ` payment for sales has been stopped until the fees are paid. Same thing with Karan. - What will happen is every online sale you have, Shopify will not pay me the money for it until they get $6500. It made me feel like... a very, very small drop in Shopify's ocean. It just made me feel like a nobody. - With little help from Shopify, Karan tried her own measures, like blocking orders from certain regions. But... - That's when I decided I have to shut my website down. - So is there any way around the fees? In fact, it's a matter of flicking a switch. - Shopify was so hard to deal with. They just go round in circles. By the end of it, they admitted that the only way to 100% guarantee that you don't get these orders is to put your website on manual, which, you know, we didn't know that till a week later. - Manual capture gives businesses more control over which orders are processed. An order doesn't become official until authorised by the merchant. Shopify confirmed to Kate's web developer that manual capture is the only way to ensure credit card fees are not charged. So why wasn't manual capture given as a solution in the first place? It told Legend... - Shopify does not automatically advise merchants to switch to manual payment when there are high-risk orders coming in because high-risk orders can be managed in various ways and switching to manual payment might not be the best solution for every merchant. - It explained that switching to manual could increase workload, slow down orders and affect customer experience, but admitted to Legend that if set up earlier, fees would have been avoided. And it seems other Kiwi businesses have been affected. Several have got in touch with Karan. In the meantime, Paire Shoes have had to take their website down. - You know, they need to be held accountable really, cos we haven't sold anything. And you know, it's a huge company. So really, they should be emailing us to tell us what to do. - But it's not all bad ` Contain Boutique just launched their new website with a new platform that has better communications. - First proper order that we didn't have to cancel and beg the customer to pay over the phone. And I rang my son, and went, like, 'Oh my God.' It was like we did our first order ever again, you know, right back at the beginning. - And here's some advice for small businesses ` when signing up to an e-commerce website, make sure you read those T's and C's carefully and ask questions. Consider putting your store orders on manual to protect yourself from future fraud. And remember, there are many platforms, so shop around. - Great advice, Star ` now, remember, we say it time and time again ` always read and understand the fine print, no matter how big or trusted the brand. Also, great-looking shops, Kate and Karan. We wish you the best of luck. - We certainly do. E haere ake nei, coming up ` the story of a surprise visitor, a shocking power bill and a forgotten meter. - 2800 was on the bill. - Wow. - Yeah. - And Kiwis love a waterblaster, but are you getting the right one for the job? What did you pay Jeff? - $135. - Kia ora. Nau mai, hoki mai. Welcome back. Winter is well and truly here, and opening the power bill can be an unpleasant surprise. - it certainly was for the young women in our next story ` they received a bill in the thousands for a meter they didn't know existed. Garth has the story. (THE WHITE STRIPES' 'SEVEN NATION ARMY') - It's couch time at the flat. Love Island on the telly. - Yeah, this is the latest one. - Not everyone's into it. - (SHRIEKS) - Winter is digging its claws in too. It's cold inside, not a heater in sight. There's been some real-life drama with power companies. - On Valentine's Day, we had a special visitor. (CHUCKLES) Not bringing us chocolates. (CHUCKLES) - Abi is talking about the guy who came to cut off their power. - And we were, like, 'Oh, excuse me. What are you doing?' - He wouldn't show any ID. - He turned off the lights and said, 'These two lights are gonna turn off when I turn it off.' And it was this one in this room and a bathroom one. Just two lights. - Yeah. - And I was, like, 'Oh, mm, OK.' I mean, strange. No, thanks. Leave. So we kicked him out. - The man said he'd been sent by Electric Kiwi. - We were, like, this is weird. We're not with Electric Kiwi. - They've only ever had power with Genesis Energy. They say they contacted Electric Kiwi, which led nowhere. Back to the everyday. This drama hadn't gone away, though. Nearly three months later, more knocking. (KNOCK AT DOOR) If anyone's awake, they're still in bed. The flat chat went nuts. - 'I'm scared of him. Should we leave it, wait for him to go away or should we let him in?' - No one answered the door, and the knocking, and my bedroom's closest, so I just came out, opened up the door, see what was going on, and he was, like, 'I'm here to deal with the metre.' And I'm, like, OK. I wanted to ask him questions, but he kind of just walks in, just kind of helps himself. Just was a little bit aggressive. - And he comes over here and just starts tutuing and starts messing with these. - It's the same guy again. This time he has a work order. The address doesn't seem to match theirs exactly. - 2/10. - So you don't even think it's your place at this point. - Yeah. Yeah. - You think it's meant to be, like, next door or somewhere else that doesn't` They've got the wrong address. - Exactly. - He was never really clear about why he was here or what he was doing, and we'd never had any notice from the power company. - The man was still refusing to show any other I'D. That's Abi standing behind him, half-dressed and half awake, calmly confronting a stranger inside their flat. - I was standing there trying to talk to him, trying to slow him down and just get an understanding. And then he just started pulling things. And then suddenly he left, and we were left with no power. - No power in the living room, nor in three bedrooms. Yet the kitchen and the other three bedrooms still seemed to be on. It's only now they discover... Two meters here. - Mm-hm. - And you guys hadn't even clocked that that was a problem. It was just always one power bill. - Yeah. Yeah. And you think, you know, that's how it should be, right? - So basically, you guys had been paying, but you'd only actually been paying for the power that was coming off of this one. - Mm-hm. - And this one was going somewhere else. - Yeah, but we just don't know where, and neither do the power companies. (TOTO'S 'AFRICA') - Like in most flats, people come and go. - I am one of the original, like, first members of this flat. - Val has the power in her name. - We were already with Genesis, and they have this thing on the apps where you just, like, put in the new address, and it's just automatically connected. - Did they ask you to check the meter or give you a number? Was there anything at the flat that you had to give them? - No. - For 15 months, they just paid the bill. - We pay on time because we have a separate account that I also look after, where we put 20 bucks in every week, and we've never been short, and just pay our power bill as it comes. - Genesis had made it seem painless, but now it's going to hurt. First, it requires an electrician to check the meter is safe to reconnect. Val confirms how long they've lived at the flat. It's only then that a bill arrives ` a big one. - 2800 was on the bill. - Wow. - Yeah. - They have six weeks to find that. Genesis offers a 10% discount, pushes it to 20%. That's still nearly $2100 on top of their usual bill. - It just screams uh-uh, you know. (CHUCKLES) - And of course, every bill from now on will also be bigger. By one measure, energy hardship affects 110,000 households in New Zealand who can't actually afford to adequately heat their homes. And if you're renting, you're six times more likely to have that problem than an owner occupier. And because this is a flat, there's added complication with a big backdated bill. - It's a huge amount of money to be paying, especially, from my perspective, and the newer flatmates. - Not all of us have been here for the whole 12 months. - We can't make power cheaper for those 110,000 households that are really struggling, but we can ask the power company some questions. Is this really how you're meant to cut people off? If these were your kids, would you be fine with this? And if it's your job to charge properly for power and you haven't done your job for at least nine months, maybe more than a year, why is the bill their problem? We hit the phones ` me and Neapolitan the kitty. Oh, OK. Have you got a minute for me to run you through that now? We actually got Electric Kiwi's chief exec on the line and then heard from its contractor, Delta. Delta says, 'Our technician is considered a pleasant person 'and has never received a complaint of this nature.' Even the flatties' complaint only mentioned confusion over the disconnect. Delta has a doorstep protocol. Top of the list ` always be courteous and wear Delta ID. And it would like to apologise if that was not carried out on the day. Electric Kiwi says it had disconnected the site as vacant a month before the flatties moved in, then was notified that power was being used and discovered the site had been reconnected, 'but this was not done by any of our registered contractors nor the metering company. 'As a gesture of goodwill, we're happy to cover half the costs for Val 'and we expect Genesis to do the same.' Genesis Energy says... 'This was a complex and unusual set of circumstances, 'but as this was genuine electricity consumption and a cost to us, 'Genesis had initially been working with the customer on a repayment plan.' But we've got better news. OK, we actually got that news after we'd left, obviously. Took a while to figure this situation out. So we're back for what we would call a door-knock. Kind of, like, a good door-knock. (KNOCKS) Hi. Hi. - Hello. Oh, hi, Garth. - (CHUCKLES) Good news, I hear. - Yes. - Or good news I'm here to tell you. I've heard from Genesis, and... - And the power bill has been wiped. Completely cleared. - Wow. - Yeah. - You look happy. - Yes, we're all very happy. So, yeah, we're really thankful for you guys. - And how's it gonna go from now? I mean, what's gonna stop this happening again? - So, they're gonna actually reach out to the realtor, merge the two meters, or actually get rid of one and make the whole house under one, cos they shouldn't have two in the first place. - Mm. OK. So that could actually solve things for somebody else. - Yeah. Whoever moves in here after us, like, hopefully they don't have the same problem, but yeah. - OK. We'll leave you in peace. - Oh, thank you so much. - Bye. - Bye. - Oh! Way to go. Brilliant result, Garth. - Yeah. - Nice one. - Good job, Garth. All right. E haere ake nei, coming up ` if you're thinking about using or buying a waterblaster, this next story's for you. Make sure your hose is plugged into your waterblaster, your tap is turned on before you turn your machine on. - Hey, Toyota. Got something that's not... new? - Yeah! Have you seen what's on Toyota.co.nz? - What are the chances you actually have what I'm looking for? - Pretty good! - Will it have any quirks? - Only if that's what you're into. - Uh, how do I know if it's any good? - Well, you are buying from Toyota, so there's that. - But I need something that comes with a warranty. - Well, Signature Class and Toyota Certified vehicles do. - That's a relief. Kia ora. Nau mai, hoki mai. Welcome back. Now, we are always saying on Fair Go there is no problem too small. So when Jeff Davies contacted us with a teeny-tiny problem, about this size, that resulted in a meltdown, I was there, gumboots and all. - Mm. Any opportunity to get your gumboots on, right? - Yes. - Well, as you've probably guessed, Hado has this story. (GENTLE MUSIC) - Down a drive, in a shed, Jeff Davies is exercising his basic human right to open up his broken waterblaster. - I thought, 'Well, I'll have a look inside and see...' That's looking promising. '...what's happened and see if I can fix it.' - He understands this will void his warranty. - You just try and remember what you did when you took it apart. - And there may be leftover screws. - Some projects, you find that have some left over for the next project. - It's a Karcher waterblaster,... - Yeah. I was happy as a sandboy. - ...bought from Bunnings. What did you pay, Jeff? - $135. - He'd had it less than a year without any problems when he lent it to a friend. - It was going great, and he did two or three sections of the fence in about an hour. - Then... - But after an hour and a half, he gave me a call and said, 'Hey, Jeff, your waterblaster's stopped working.' So he phoned up Karcher, and five minutes later, he came back and said, 'Well, I've got bad news for you.' And I said, 'Well, what's the bad news?' You're only allowed to use it for the maximum of an hour a day. - We'll hear more from Karcher shortly. But Jeff reckons... - The problem with the waterblaster is basically it had a meltdown. - Jeff's no expert, but he believes the problem is deep inside this perfectly good waterblaster. - Beautifully engineered device. Everything metal except for two little plastic gears. These are the cogs. - They're called 'planetary cogs'. - So they basically rotate around inside there, just like planets orbiting. - But according to Jeff, the cogs did not do much orbiting. - This started getting hotter and hotter. The gears eventually reach a temperature where the plastic melts. You know, that's it ` game over. That was the end of my waterblaster. - One perfectly good waterblaster rendered useless. Jeff maintains it's because of two cheap plastic cogs in a metal case. What would happen if they were metal? - Well, I would imagine that it would last a long time. - But Karcher reckon that because Jeff opened up the machine, it's unfair to speculate on the cause of the fault? Their best guess is that the cog meltdown was more than likely caused by a failed seal or water leaking into the oil. With no oil to lubricate the cogs, it doesn't matter whether the cogs are metal or plastic, they will eventually fail. Karcher believe their waterblasters don't have a maximum usage time, although, they know Jeff's model is designed for smaller tasks like cleaning a car. These tasks will generally take 30 minutes or less to complete, so running the machine for significantly longer does bring some risk. Karcher also promises, 'Every product is tested to ensure 100% performance, 'and we often have happy customers seeking new accessories for machines 'that are well in excess of 20 years old. 'We're disappointed that Jeff feels this way 'and would very much welcome the opportunity to help him directly.' We spoke to a waterblasting repairer and showed him photos of Jeff's broken machine. He said small machines are not designed to run for hours and hours and that metal parts are definitely better than plastic. But if the oil gets compromised around the cogs, then, metal or plastic, they will fail eventually. And top tip from Haydo ` before you start, make sure your hose is plugged into your waterblaster, your tap is turned on before you turn your machine on. That advice is echoed by Consumer NZ, which says... - Buy the right tool for the job. Ask what will I be waterblasting? How often will I use it? And for what periods of time? Most entry-level to mid-range waterblasters have air-cooled pumps, which can only be used for a maximum of an hour without overheating and needing a stand down period of 20 minutes. If you run them for several hours, you risk burning out the pump, rendering the machine useless. For big jobs requiring long spells of blasting, look for a water-cooled pump driven by an induction motor.' - And finally, think on this ` - An average garden hose flow is around 30 litres per minute. Consumer tested waterblasters rated at between 5 litres and 7.3 litres per minute. So using a waterblaster means a substantial water saving and likely a better cleaning job. (SERENE ORCHESTRAL MUSIC) - Jeff Davies ended up putting new plastic cogs in his machine because metal ones aren't available. And for the princely sum of around NZ$30, he's confident. Kind of. Do you think it will go? - (CHUCKLES) I hope so. - It was a bit of tinkering. - It's always the simple things, isn't it? - Then... victory. - Just like a bought one. (CHUCKLES) - I really love waterblasting, but the problem is knowing where to stop. - (CHUCKLES) - Cos it just keeps getting messy right? - The same with haircuts. - Yeah. And that is it from us, but if you only caught part of the show, you can catch all of it, plus past episodes, and some handy consumer information on the Fair Go page on TVNZ+. - Cos funnily enough, our programme is all about you at home, your consumer aches and pains ` please do get in touch. - Yes, we're on Facebook, TikTok and Instagram. You can go to our webpage ` tvnz.co.nz email us ` FairGo@tvnz.co.nz or write to us ` Po Box 3819, Auckland 1140. - Thank you for watching. Walter in Fairlie, how about the brown shoes ` are they more to your liking? - Let me know. - (LAUGHS) - Until next week,... BOTH: ...pomarie.