Dreamhost mistakenly bills customers for the entire year

[icekin]

I got one of these emails last night, telling me that they could not charge my card and I had a limited time to pay up. I've been with Dreamhost for a year and a half now and had no major problems, but I suspect they will be losing a few customers over this screw up.

<a href="http://digg.com/tech_news/Dreamhost_mistakenly_bills_customers_for_multiple_years">DH Billing Issues Page</a>

<a href="http://blog.dreamhost.com/2008/01/15/um-whoops">DH Blog Entry</a>

[tranglos]

I was just going to post after I've read the comments...

Dreamhost is one of the best - probably THE best, friendliest, most human and most attentive company I've ever dealt with. I'm really sorry this happened to them.

Two lessons there: one is contained in the blog entry, for coders. It was really dumb to let the system accept a future date for billing, and not even flag it for confirmation as suspicious.

The other lesson is never to leave your credit card in the hands of an automated billing system, at least if you have that option. DH gives you an option to keep your CC on file and rebill automatically, but you can say no to that easily on the same page where you pay the bill. And even if you choose the auto option, you can limit the max amount they can charge, the default being $100 IIRC.

I remember thinking about this when I was signing up 4 years ago, and deciding that filling out the invoice form manually once a year is a good deal if I get 100% peace of mind in return. I wish all my decisions turned out like this

Now if enough of the po'ed customers gang up and take DH through a legal grinder, I might find myself without my domain, and then I'll be po'ed too!

[Deozaan]

Yeah I wondered why the e-mail I received this morning said I had a past due amount as of November 2008 when that wouldn't even be possible until ten months from now.

I asked Allen, who also uses DreamHost and he had already received a "Whoopsie" e-mail and his credit card had been billed. My bank account doesn't seem to have been billed but I didn't get the "Whoopsie" e-mail until a couple hours after I got the explanation from Allen. I have my account set up to charge automatically but I had it limited to $50, which I changed to $25 today. But like I said, I still don't see any charges on my bank account.

I also tried to find information about it from DreamHost's website and I didn't see anything about it anywhere.

I'm not too mad about it because I wasn't really affected by it. Just a little scared from the first e-mail telling me I owed so much money. If my bank account had been charged and become overdraft or whatever, then I'd probably be a bit more upset. But I've worked in customer service before and I know about billing errors and how if a respectable company overdrafts your account due to errors they'll pay any fees you incur, so I wasn't worried.

[jazper]

Strange, I got an email saying I was billed but didn't think twice because I was due to be billed anyday now, so it didn't really affect me.

[tranglos]

Strange, I got an email saying I was billed but didn't think twice because I was due to be billed anyday now, so it didn't really affect me.

In the DH blog comments some customers say they've been billed twice, so maybe double-check.

I expected my payment notice to come in early Feb, so the email totally made sense, until it said "You also have $119.40 past due (owed since 2008-11-09)", which was a red flag.

[lanux128]

it looks like the company has a serious flaw in their billing system..

• DreamHost's $7.5M billing accident: "Um, Whoops."
from Download Squad

[justice]

one is contained in the blog entry, for coders. It was really dumb to let the system accept a future date for billing, and not even flag it for confirmation as suspicious.

I keep reading that. I'm not sure how the situation is in the Us, but in the UK many hosting companies bill per 12 months, which means you're paying 12 months in advance. If the software used is not specifically made for Dreamhost then it's actually very important that it can bill in advance.

[tranglos]

I keep reading that. I'm not sure how the situation is in the Us, but in the UK many hosting companies bill per 12 months, which means you're paying 12 months in advance.

You are paying for future services, yes, but the "date due" is today. So if they mistakenly run the billing system for 09 November 2008, they're accidentally charging you for all of 2009, a year too early. And to make it worse, the system thinks you did not pay for 2008, so they charge you for that, too. At least that's what I think happened.

If the software used is not specifically made for Dreamhost then it's actually very important that it can bill in advance.

It appears to be custom in-house software. They talk about tweaking it themselves.

[Ehtyar]

Strange, I got an email saying I was billed but didn't think twice because I was due to be billed anyday now, so it didn't really affect me.

Ditto, but might i mention how disgraceful i find it the way everyone seems primed and ready to bash the he** out of these people. The problem was theirs; they admitted it, they fixed it, they apologized. What more can one ask for? I can imagine far worse results have afflicted the customers of lesser hosting services.

Ehtyar.

[icekin]

It seems that Dreamhost has agreed to refund all their customers for any charges they may have incurred on their cards. This includes overdrafts that the banks may have charged the affected customers. More information on the following official blog posts :

<a href="http://blog.dreamhost.com/2008/01/16/the-aftermath/">The Aftermath</a>

<a href="http://blog.dreamhost.com/2008/01/17/the-final-update/">The Final Update</a>

Funny, where did all those angry people threatening to sue go all of a sudden?

[Lashiec]

To the bank, of course

[Deozaan]

Nice.