Why do companies keep money earned by deactivated affiliates?
 

I have always ben curious about this - most affiliate programs; if an affiliate violates the TOS, not only is the account terminated, but the program almost always keeps all the money.

Is'nt this unethical? I mean, sure; the affiliate may have done something unethical as well, but the company should'nt keep more than what the cost was to recoup from said violation.

Affiliates work hard and spend a lot of money to bring signups in, in the event of such a situation, why not divy up profits to appease all?

I just don't get it.

some people probably get away with fraud so this might help even things out, as long as the termination is just I have no problem with them keeping the money.

Say you generate a mix of legitimate and fraudulent signups and you get caught. There's no easy, reliable way to determine which joins are bad and which are good. And those that are bad have the potential to end up as chargebacks several months in the future.

If you fuck me, why should I pay you when there's a possibility that I'll end up with 50 chargebacks in the next 3 months with no way of recouping my losses?

In the case of fraud, the penalties a sponsor may choose to apply are their choice. A punative approach is not uncommon and as long as you know what you are getting into ahead of time, it's your choice to accept these terms or not.

On a parallel line of thinking though, when a company like iBill decides (on its own) that, during its financial crisis, to penalize anyone who wants to jump ship by threatening to put them on the 'slow boat' when it comes to paying them out, does reflect an ethically challenged posture.

-Dino