fraudulent chargeback

Unfortunately this is a hard reality of accepting credit cards.  

When there is a chargeback, in most cases the customer will win. The "fight" is between you and your customer, and - by design - there really isn't much that a merchant service can do about it. They're just the middle man.

This is a side effect of the original deal the credit card companies made with government regulators back in the 1960's. In exchange for them being able to charge companies 3% or more to process charges (which is highway robbery), they promised very generous policies for refunds to card holders. Essentially they made it  the company's job to prove that charges were legitimate and that the customer received what they paid for - basically to prove a negative. And even so (as you have discovered) if the card holder sticks to their story they usually win.

In my experience, I've done a lot of work to prove the customer is wrong, and yet if they just say "nope that's all wrong", they will still win. Over the years we've had perhaps 40 - 50 chargebacks, and I think they were all "blue sky" except for two, which did seem to be actual fraud like a stolen credit card.

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The up-side for you as a consumer is that if your card is ever compromised and fraudulent charges appear, all you have to do is call you CC company and say, "that's not mine!", and they'll issue a full refund to you, and then try to pull the money back from whoever got it. Even if they fail to do that, you'll get your money. And in that case, the credit card company (not your merchant service) has to eat it.

Similarly, if you buy something that you find out is garbage, or arrives broken, or is otherwise unsuitable, and the vendor refuses to refund your money, you can call and describe your case and - if reasonable - most of the time you'll get your money back and they'll get a chargeback.