Credit Card FRAUD Warning for online stores

Discussion in 'NZ Computing' started by Paul M - ProSouth, Sep 23, 2004.

  1. Credit Card FRAUD Warning for Online Stores

    Please be advised that there is currently an increase in Credit Card Fraud
    activity for orders to be delivered to Epsom in Auckland, and possibly other
    suburbs.

    We have been stung twice in the last couple of weeks, fortunately not for
    massive amounts.

    What makes this fraud different from the usual is that both orders were rung
    through via our 0800 number rather than via our online store, were using
    stolen NZ Credit Card numbers (rather than the usual US cards), and the
    orders were for small quantities of computing components (eg a hard drive
    and stick of RAM in one order), making them very difficult for our call
    centre staff to detect.

    The orders were in the name of "Sam Carter", which we believe is a fake
    name, and were delivered to an address in Gillies Ave in Epsom. The address
    is genuine, however the person living there does not know "Sam Carter". The
    fraudster has waited outside the house and intercepted the couriers as they
    have arrived with parcels, and has called on the occupants, both in person
    and on the phone, asking if there were any parcels for him. The occupants
    have had around 10 parcels delivered for the fraudster, not counting the
    (most likely much larger) number successfully intercepted by the fraudster.

    Fortunately the occupants of the house, becoming suspicious, contacted us.
    We were then able to have our bank contact the legitimate card holder who
    confirmed that the cards (or, at least, the card numbers) used to order the
    items were definately stolen, and the transactions not authorised by them.

    We would advise all other computing companies providing a delivery service
    to check for any orders delivered to this area in the last 2-3 weeks, and to
    be extra vigilant in confirming the legitimacy of any orders placed to this
    suburb, or called through by an individual of Indian descent giving the name
    "Sam Carter" or similar.

    As per usual, the banks are not interested in investigating or following up
    on this fraud (as we are the ones that have to pay, not them), hence the
    need for this warning. Please also pass this on to anyone else you know who
    operates an online business.

    For those of you that do not know, if a Credit Card transaction is processed
    "Card Not Present", ie online, over the phone, or via mail order, the
    merchant (i.e. the company taking the order) is 100% liable. Even though the
    transaction is accepted by the bank at the time, if the card is reported
    stolen a month later the bank will reverse the transaction leaving the
    company out of pocket. Unfortunately, because they do not have to pay, the
    banks are generally not particularly helpful in preventing fraud, or
    reacting when a fraud is detected.

    We have notified the Police, and will pursue these fraudsters in any way
    possible. If you have been targetted by these people, or have any further
    details about these frauds or fraudsters, please contact myself or a member
    of our team via email or at the phone number below so we can all work
    together to catch the little bastard(s).

    Regards,

    Paul Matthews
    ProSouth Technology Solutions
    Phone: +64 3 470 1321
    DDI: +64 3 470 1324
    0800 PROSOUTH (0800 776 768)
    249 Cumberland Street, Dunedin, New Zealand
    Visit us at www.prosouth.co.nz
     
    Paul M - ProSouth, Sep 23, 2004
    #1
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  2. Paul M - ProSouth

    Rosemary rm Guest



    How do you know they are little..?
     
    Rosemary rm, Sep 23, 2004
    #2
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  3. Paul M - ProSouth

    EMB Guest

    How do we know it's not you Woger?
     
    EMB, Sep 23, 2004
    #3
  4. Paul M - ProSouth

    ~misfit~ Guest

    Because, Rosemary, he would have a description from the people who live in
    the house from when they call to collect parcels.

    Use your brain girl, you can't just use your money-maker all your life.
     
    ~misfit~, Sep 23, 2004
    #4
  5. Paul M - ProSouth

    colinco Guest

    Please be advised that there is currently an increase in Credit Card Fraud
    activity for orders to be delivered to Epsom in Auckland, and possibly other
    suburbs.

    We have been stung twice in the last couple of weeks, fortunately not for
    massive amounts.

    What makes this fraud different from the usual is that both orders were rung
    through via our 0800 number rather than via our online store, were using
    stolen NZ Credit Card numbers (rather than the usual US cards), and the
    orders were for small quantities of computing components (eg a hard drive
    and stick of RAM in one order), making them very difficult for our call
    centre staff to detect.
    [/QUOTE]
    Since you are nowhere near cheapest for these items, the fact that
    someone in Auckland of all places was placing an order with you should
    have made you realise something wasn't right.
     
    colinco, Sep 23, 2004
    #5
  6. How do we know it's not you Woger?


    But didn't woger say just before that it is him ? Under the post RogerS aka
    Woger

    "And why should I pay for a HP Free fix kit..
    Plus I did reply, but have been very sick, I have only just recently came
    out of Hospital, and on stacks of pills to try and keep me alive.
    You only e-mailed me yesterday.."

    The message was sent to 'Karen' and 'Rosemary' answered saying 'I did
    reply'.

    Ergo, 'Rosemary' is 'Karen' who is Woger.

    It's pretty bloody childish really and a complete waste of time dealing with
    though. The guy is slipping downhill very very rapidly.

    Bad news about the credit card fraud though - hope someone is able to catch
    the prick and smack him around the head a few times.
     
    ..Waylon Smithers.., Sep 23, 2004
    #6
  7. Since you are nowhere near cheapest for these items, the fact that
    someone in Auckland of all places was placing an order with you should
    have made you realise something wasn't right.[/QUOTE]

    Hi, Colinco.

    Whilst I don't think this is really the correct place or thread to discuss
    this, and I do not want to detract from the original fraud warning, I do
    think it's appropriate to respond to your comment.

    You would probably be very surprised at the volume of orders we receive from
    Auckland, and in fact the rest of the country. Whilst it is true that we are
    not the "cheapest" for many items, we believe the reason we are thriving in
    an oversaturated market is twofold:

    Firstly, we do not hide the true cost of ordering our products behind
    freight charges, credit card fees, and ex-GST pricing (please see
    www.prosouth.co.nz/nohiddencosts for more info). Whilst this might
    negatively affect our perceived prices and product listings on the PriceSpy
    website for instance, we believe that many people see through the practices
    of some other companies, and appreciate our honesty and transparency in this
    regard.

    Secondly, over the years, we have built up a strong customer base of people
    and organisations that prefer to deal with a company that has been around
    for several years, has qualified and experienced technicians able and
    willing to answer any questions they may have via our 0800 support line,
    attend to any warranty or support issues promptly and with a minimum of fuss
    (we handle most warranties directly and replace faulty items from our stock
    and worry about chasing it up with our suppliers later, rather than just
    pointing our customers and clients in the direction of the distributor),
    offer prompt delivery (we carry many items in stock, meaning that most
    orders are dispatched from our Computing Solutions Centre on the same day
    they are ordered), and will be around in 6 months to look after any problems
    our customers may have in the future.

    Whist we realise that a large number of people do purchase based purely on
    price, there are still many out there who appreciate a bit of good old
    fashioned service, and it is to this group that we cater.

    This post is not intended as a trumpet for our company, but rather as
    confirmation that we do, in fact, send a lot of items to Auckland, as well
    as the rest of the country. I hope that I have answered your comment
    appropriately. The original fraud warning was placed in good faith for
    others in the same position as us, and, whilst I'm uncertain as to the
    motives of your comment, if you would like to discuss this further, or have
    any further queries, please do not hesitate to contact either myself or a
    member of our team via email or on the numbers below.

    Regards,

    Paul Matthews
    ProSouth Technology Solutions
    Phone: +64 3 470 1321
    DDI: +64 3 470 1324
    0800 PROSOUTH (0800 776 768)
    249 Cumberland Street, Dunedin, New Zealand
    Visit us at www.prosouth.co.nz
     
    Paul M - ProSouth, Sep 24, 2004
    #7
  8. 10:45:32 +1200, ..Waylon Smithers..
    And you don't really care do you
     
    Patrick Dunford, Sep 24, 2004
    #8
  9. Since you are nowhere near cheapest for these items, the fact that
    someone in Auckland of all places was placing an order with you should
    have made you realise something wasn't right. [/QUOTE]

    Why is that?

    I buy stuff from Ascent in Wellington - they are not the cheapest but
    their service is very good.
     
    Patrick Dunford, Sep 24, 2004
    #9
  10. It's pretty bloody childish really and a complete waste of time
    You'll let people know when you have a point to your posts won't you Patrick
    ?
     
    ..Waylon Smithers.., Sep 24, 2004
    #10
  11. why?
    price is not the only factor in a purchase.
     
    Dave - Dave.net.nz, Sep 24, 2004
    #11
  12. 20:54:12 +1200, ..Waylon Smithers..
    You should change your name to WogerBaiter... or why else is it that you
    are so obsessed with his posts
     
    Patrick Dunford, Sep 24, 2004
    #12
  13. Paul M - ProSouth

    colinco Guest

    price is not the only factor in a purchase.
    [/QUOTE]
    Yes, how easy it is to use a stolen card comes into it.
    The items bought were commodity items, HDs, memory that you can get over
    the counter in many stack high sell cheap AK stores.
     
    colinco, Sep 24, 2004
    #13
  14. It's pretty bloody childish really and a complete waste of time

    You'll let people know when you have a point to your posts won't you
    Patrick.

    Echo echo echo . . .
     
    ..Waylon Smithers.., Sep 25, 2004
    #14
  15. 15:46:04 +1200, ..Waylon Smithers..
    The point was well mentioned above. You should change your name to
    Wogerbaiter. Or maybe you're getting engaged to Rosemary?
     
    Patrick Dunford, Sep 25, 2004
    #15
  16. Paul M - ProSouth

    ~misfit~ Guest

    Take this OT shit elsewhere. Maybe alt.flame?
     
    ~misfit~, Sep 25, 2004
    #16
  17. What's worse is the fact that I have come up with a bullet-proof way
    of authenticating that the person placing the phone/online order is
    actually the authorised card-holder.

    The potential for this system to virtually eliminate "card not
    present" card fraud is immense and it's not reliant on passwords,
    PINs, hardware or digital signatures. In short -- it's so easy to use
    that *anyone* can and almost certainly would use it.

    I built a working system and it was demonstrated to the banks -- but
    they still were not interested.

    It's almost as if this kind of fraud is a key component of their
    business model :-?

    I have since sold the rights for a song. It's a shame really, it
    could have been a very useful asset to NZ in building our knowledge
    economy :-(
     
    Bruce Simpson, Sep 27, 2004
    #17
  18. Paul M - ProSouth

    David Pears Guest

    Could you provide a quick summary of your method? I can think of no
    way to determine whether a person on the end of a phone line is an
    authorised card holder or not without some sort of shared secret. And
    even a shared secret relies on the secret not being given to another
    party.

    David
     
    David Pears, Sep 27, 2004
    #18
  19. Paul M - ProSouth

    Collector-NZ Guest

    Bruce Simpson said the following on 27/09/2004 11:21:
    I like the way PBTECH handles online, you place your order, get a order
    number from them as a reference, then either send a cheque via post or
    do an internet bank transfer using the ref. No credit Cards Required, No
    Authentication Passwords PINs required. Works a treat and almost
    impossible to abuse.
     
    Collector-NZ, Sep 27, 2004
    #19
  20. Paul M - ProSouth

    Bok Guest

    Sounds interesting Bruce. I can see how such a scheme that could
    eliminate the 'card not present' issue would benefit the merchants. What
    benefit were you trying to sell to the bank(s)? In order for the onus of
    liability to shift the scheme needs to support legally binding
    non-repudiation for both parties involved in the transaction
    (card-holder & merchant).

    Does your method support nonrepudiation as well as authentication? The
    mechanism would need to secure the entire transaction including delivery
    and acceptance of the goods. If not, which party becomes liable for an
    alledgedly ' failed ' transaction?
     
    Bok, Sep 27, 2004
    #20
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