Net Shoppers Bullied Into "Verified By Visa" Program 302
bluefoxlucid writes "According to The Register, several banks are forcing users to opt-in to the Verified by Visa optional service by locking their cards if and when they encounter a Verified by Visa participating site and fail to opt-in. Register reader Steve says, 'This seems like a strange way to implement a voluntary system. On most of the retailers' websites there is no clue that you are about to be challenged by Verified by Visa until you attempt to complete the transaction. This means that you trigger the "fraud protection" unintentionally. And when you have located a retailer who doesn't require Verified by Visa to complete a purchase, you can't because your account is on hold.' Further, '[I]n some cases resetting the password is all too easy. Fraudsters know this and go after these credentials which, once obtained, make it harder for consumers to deny responsibility for a fraudulent transaction. Phishing scams posing as Verified by Visa sites have sprung up targeting these login credentials.'"
VbV doesn't seem to work the same with newegg (Score:5, Interesting)
I notice my newegg transactions redirect through a verified by visa page at the end of the checkout transaction.
I was never asked to opt in or provide a password or any other additional information or join anything.
Not sure where the problem is on this side of the pond.
Frankly, I'm cool with any additional security measures as long as I'm not forced into signing up special. And I assume all my personal info is already known by both newegg and visa.
Optional abuse (Score:4, Interesting)
This is probably a good thing, cardholders... (Score:1, Interesting)
Verified by Visa, 3D Secure, etc are GOOD for you.
"Card not present" transactions -- and especially online payments -- are inherently risky. 3D Secure essentially makes your payments password protected.
The dark side is that the card networks are pushing this so that they can move fraud liability from the merchants to the consumers.
Does Skype do this? (Score:5, Interesting)
I haven't been back since.
Re:Why are all stories tagged "signed"? (Score:3, Interesting)
Verified not to work (Score:5, Interesting)
Re:This is probably a good thing, cardholders... (Score:5, Interesting)
I'm not so sure.
I think all of my cards have switched to Mastercard now, but at least one of them was a Visa credit card until fairly recently. I came across this "Verified by Visa" thing out of the blue one day, having had no prior warning from either my card company or the merchant that I should expect it.
So I did what any smart person does when a web browser surprisingly pops up a window they've never seen before and asks for their confidential information: I left the site immediately, cancelled that card and reset all my security details, and shopped elsewhere using a different payment method in the meantime. Both Visa and the merchant in question lost out on that one.
Re:Out on a limb (Score:2, Interesting)
And hand made clothes? Seriously? What, do you kids wear knit sweaters everyday?
Re:Verified by Visa useless to customers (Score:3, Interesting)
I had that happen to me a few months ago, but at the time I thought it was perfectly reasonable.
I bought a digital SLR on-line (about $1200CDN). They have no history of me shopping on line (I usually don't), and a big purchase stuck out.
The next night I was paying for dinner and the card was declined. Right away I knew I'd flagged their system and called them the next day.
Personally, I kind of liked the fact that they're monitoring my account for atypical transactions. The alternative is much worse.
I guess VISA and the merchants are in a tough place -- if they don't scrutinize stuff, they get defrauded. If they do, they might irritate customers as their security flags lock the account.
Cheers
Re:sounds like change to Mastercard (Score:4, Interesting)
If Visa is going to behave badly, dump them.
From TFA:
Visa and Mastercard are a cartel. [cnn.com] If one screws over the customer, so does the other.
Hello Americans, British and European banks laws (Score:3, Interesting)
BITE
Seriously, while we live far from a legal utopia in the US, the little bits I have learned about banking laws and regulations in Europe make we amazed that those folks don't keep all their Euro's and pounds in their mattresses.
It seems that often Europeans have no recourse against banking mistakes. But on the US side of the pond banks would rather take the losses from robbery than but in "unfriendly looking" security that might make customers feel uncomfortable. Hence they also take the loses on Fraud, identity theft, etc.
And you wondered why your credit card charged 22% interest.
I had my Visa Locked because of this (Score:2, Interesting)
We ended up having to get a new card issued with a new number, which took a week, during which I had to make sure that nothing like Netflix auto-billed my old "locked for fraud" card number.
Re:Verified by Visa Backdoor (Score:5, Interesting)
Re:Out on a limb (Score:3, Interesting)
I do have one objection, while I hate Wal-mart for other reasons they actually pay good wages for the work(I've worked for them out of desperation for temporary work and got 9.90 an hour starting and well above minimum wage.)
Regardless, railing against trade is just silly and misinformed, there's a reason we've been doing it for so damn long, and in general it is mutually benefiting.
Re:Out on a limb (Score:1, Interesting)
I think you're missed something.
I really hate to defend Wal-Marx, I'm gonna feel dirty after this one, but in this case I sadly feel a need to. I work at a counter, selling cell phones for much less then the cell phone stores and make much more then minimum wage. $12/hour to stand around chatting is rather nice. Hell, even the cashiers make more then minimum wage. The only ones that make that are maybe the door greeters.
Also, we donate a lot of money to the local community and events.
Product that would normally be thrown out because it's damaged is donated to local non-profit groups. Torn bags of diapers are donated to local womans shelters as are clothes that might have a small ink mark or something. Torn bags of pet food are donated to local ASPCA branches to distribute. These are just examples, much more is done.
Is Wally World perfect? Hell no! Management is inept and the few good ones are moved around the store before they can fix the problems. The health care kinda sucks. The company headquarters treats you dirt. But hell, it beats working for Target (nice clean store but with a company that makes Wal-Marx look employee friendly)
Amex rules (Score:1, Interesting)
This is the reason I threw away my Visa and took Mastercard and Amex instead. I had my card stopped three time. Now I earn more reward points on my Amex than any card I had previously.
Re:Out on a limb (Score:3, Interesting)
Well, assuming you're really buying locally (as in, buying locally grown, locally made products) it's reducing the carbon footprint of the purchase astronomically. Even buying from a "local" big box store helps this to some extent. Walmart and Best Buy ship their products very efficiently compared to the "Mail one box to your house" method used for online purchases. Think about it:
1) Grown/make a item yourself- zero gas or oil used in shipment
2) Item grown/made locally- Only fuel needed to get it from local producer to local market needed
3) Item grown/made far away, bought at local store- fuel needed for maximum efficient shipment fro producer to store (potentially a lot)
4) Item grown/made far away, bought online- Same as three (the stuff had to get to the warehouse), plus the fuel needed to get it from the warehouse to your door in a single items shipping container.
It's not a perfect analogy, I might actually be saving fuel overall if I buy online directly from the manufacturer. Especially if the manufacturer is a small "local" business in a another locality, but in general buying online is the least fuel efficient way to get a product.
Re:Verified by Visa useless to customers (Score:3, Interesting)
Personally, I kind of liked the fact that they're monitoring my account for atypical transactions. The alternative is much worse.
No it's not. At least not for you, it is for the bank, which is why I get annoyed every time they say "for your protection" - uh, uh it is for THEIR protection and they shouldn't patronize me by lying about it.
Absolute worst case, you end up losing $50 - that's federal law. In almost all cases, the bank waives that fee so that you owe nothing - they or the merchant that took the fraudulent transaction are on the hook. Now compare that to a situation in which you absolutely need your credit card to work and any delay or hassle could screw things up - last minute plane tickets, car repairs during an interstate road trip, paying for a night out with a girl you really want to impress, getting in a very short term sale price, etc.
I have experienced the same thing as "smallshot" describes too many times. How stupid is it that you just authenticated with a username and password immediately before making the transaction and then they want you to authenticate over the phone using weaker credentials like billing address, the size of your last bill, etc - ALL information that anyone who has your username and password can look up the bank's website? One time I actually logged in while they were on the phone and read the information off their own website back to them because I couldn't remember the size of my last monthly bill.
Federal law says you are liable for $50 max for CC (Score:2, Interesting)
Re:This is why I use American Express (Score:3, Interesting)
Also, I like the fact my card is clear!
Great, and as a business owner I despise you. AMEX holds money for 2 weeks before paying me. So does Discover.
That's why I don't take either one, publicly.
Re:Out on a limb (Score:2, Interesting)
If it is more efficient to buy from a "local" big box store because they ship the product very efficiently. Then wouldn't it also be better to buy produce from the local supermarket because they can ship the product very efficiently, rather than every local farmer driving to the local farmers market, or worse yet every consumer driving out to the local farm?
The same logic of efficient shipping would apply to online stores as well, the shipping companies are probably very efficient as well. And instead every person taking a trip to the "local" big box store you have one truck delivery many boxes to many customers. Say you have 100 people who need goods, they live an average of 5 miles from the store, that's 500 miles. the local box box stores are more than 5 miles away for me. How far would 1 truck have to drive to deliver the same 100 packages? if the cars averaged 25 mpg and the truck 5 (probably better for a delivery truck) then the truck would be more efficient if it drive less than 100 miles, which IMO sounds very reasonable.
I mean, it's not like there is one truck per customer driving all the way from the companies head quarters. They use services like UPS who's job is to ship packages, if they don't do it efficiently they loose business.
Of course I am playing devils advocate, me and my wife try to buy most of our produce from the local farmers market (every Saturday), it's fresher, tastes better and there is a sense of community.
Re:Merchants instantly lose chargebacks if they do (Score:1, Interesting)
Costs of recovering from a $10 000 fraud shared among a million card holders is much less painful for each card holder than the cost of recovering from a $10 000 fraud borne by a single card holder. This is a simple actuarial proposition. On top of that, because of economies of scale (in-house legal counsel, in-house anti-fraud staff, contracts with collections agencies, etc.) the odds of substantially recovering from any fraud are greater for the card issuer than for any single card holder.
Moreover, dropping the risk into the lap of the card issuer provides an incentive for better knowing their own merchant customers.
I think that a strong and essentially no-fault protection insurance package for cardholders would be very popular if set at a price not too far from the cost of servicing the policies for all cardholders. This is essentially what is bundled in, by statute, or by local customary business practices, in many markets around the world.
In fact, it is popular enough in markets in which the cardholder faces a large fraud risk, that third parties (who are often partially owned by the transaction brokers or credit issuers or both) often sell explicit insurance packages at a substantial profit.
It is the consumer (and taxpayer) who faces the ultimate cost of fraud. All costs of recovering from fraud are passed down through increased fees or taxes to cover legal costs, court fees, judgement enforcement costs, criminal investigations and prosecutions, and the loss of probably taxable wealth from the defrauded to the likely tax-evading (or overseas!) fraudsters.
So you're right that costs are pushed downards. You are wrong in thinking that not "pseudo-socializing" the risk by putting risk on the transaction brokers and card issuers is really more economically efficient.
Re:Financial institutions aren't liable anyway (Score:5, Interesting)
You said it! VbV may be imperfect but compared to the zillions of stories about identify theft etc. at least it's a technical attempt to improve the situation. Bruce Schneier has said that the key step to improving credit card payment is looping the transaction security through the banks (Visa) not the merchant, and that's what this looks like.
I for one would pay more for a card that came with a secureID card or used my cell phone or something else for savvy consumer to confirm transactions. Even though I'm not liable for fraud ultimately, the idea of the fraud just annoys the crap out of me and I'm game to pay to make it harder for the fraudster.
Re:Federal law says you are liable for $50 max for (Score:3, Interesting)
They don't pay anyway - the merchant does. If someone buys a product on your card and you report it stolen or fraud then they charge it back to the merchant most of the time. The customer may get their money back but the merchant ends up out a product.
Especially fun if you have a customer buy something big and then report it as fraud. "I ordered an iPod and all they sent me was this cheap knock-off!" Unless you're WalMart they get their cash back and you're out the iPod.
I hate dealing with credit cards and PayPal. I wish the freaking government would just do the right thing and offer a usable Internet-friendly currency.