GameStop, Other Retailers Subpoenaed Over Credit Card Information Sharing 117
New York State's Attorney General, Andrew Cuomo, has subpoenaed a number of online retailers, including GameStop, Barnes & Noble, Ticketmaster and Staples, over the way they pass information to marketing firms while processing transactions. MSNBC explains the scenario thus: "You're on the site of a well-known retailer and you make a purchase. As soon as you complete the transaction a pop-up window appears. It offers a discount on your next purchase. Click on the ad and you are automatically redirected to another company's site where you are signed up for a buying club, travel club or credit card protection service. The yearly cost is usually $100 to $145. Here's where things really get smarmy. Even though you did not give that second company any account information, they will bill the credit or debit card number you used to make the original purchase. You didn't have to provide your account number because the 'trusted' retailer gave it to them for a cut of the action." While there is no law preventing this sort of behavior, Cuomo hopes the investigation will pressure these companies to change their ways, or at least inform customers when their information might be shared.
Re:PCI? (Score:5, Informative)
Depends on who is actually running the charge. If it's B&N, for instance, who runs the transaction and then gives the $$$ to the 3rd party minus B&N's kickback, then there is really nothing there against PCI rules. If B&N is giving the 3rd party client all the card info, then there could be some problems. But even then, the big no-no is how the CVV code is handled. So long as it isn't stored anywhere outside of ram and that it is discarded once the transaction is made, the PCI folks don't give a damn as far as I can tell.
I'll give an example. We run a system where each one of our merchant has their own processing account. Usually we charge the merchant a flat annual hosting fee, but some of our clients wanted to move to a different model where we added in a $1.00 per order service fee to their customers instead of paying the annual rate. Our clients cited the economy, blah, blah, blah, and it's not something we wanted to do, but it was either that or loose the revenue from that client period. So we basically run card twice, once under our gateway for the $1.00 fee, then again under the merchant's gateway for the total bill.
Re:PCI? (Score:5, Informative)
FALITFA ( http://www.ag.ny.gov/media_center/2010/jan/jan27a_10.html [ny.gov] ): Barnes & Noble, Orbitz.com, Buy.com, Ticketmaster.com, MovieTickets.com, FTD.com, Shutterfly.com, 1-800Flowers.com, Avon.com, Budget, Staples.com, Priceline.com, GMAC Mortgage, Classmates.com, Travelocity, Vistaprint, Intelius, Hotwire.com, Expedia/Hotels.com, Columbia House, Pizza Hut and Gamestop/EB Games were subpoenaed.
Social Games and the Federal Probe (Score:5, Informative)
with out authorization it is credit card fraud among other things that a DA will throw at me. If a business gives my information to a third party and the third party charges my credit card then that's just sharing? I need to start up a couple of businesses.
Apparently social gaming [slashdot.org] is a great business model for this kind of crap. The mentioned retailers get you after you make your purchase but when you need more resources in Farmville or Mafia Wars on Facebook [slashdot.org]:
In games like Mafia Wars, Farmville, YoVille and Vampires Live, you know, some of the major sources of all those garbage announcements cluttering up your Facebook, players compete to complete missions and level up. By leveling up, you can complete more difficult missions and fight off weaker opponents. You can wait for your various energies to regenerate naturally over time, or you can purchase with real money in-game boosts. Or, you can complete various lead generation offers, many of which are of the "answer page after page of questions and opt in and out of receiving various kinds of spam" variety. Some of them install malware and adware that is impossible to remove. And some of them secretly subscribe you to monthly recurring $9.99 credit card charges.
Don't ever put your credit card information into Facebook or a Facebook app. Social Media is rife with crap like this [washingtonpost.com]. Right about now we should be asking when we'll get to see the findings in the the federal probe that set out to address shoddy "business practices" like this [slashdot.org] and what is being done about it now that we know about it [senate.gov]?!
Re:Legal but dishonest (Score:5, Informative)
Both VISA and Mastercard have very explicit regulations on data sharing, and how 'Cross Sales' are conducted: they both prohibit it in their merchant agreements.
VISA is somewhat lax on its enforcement, preferring to take a case-by-case approach if there is abuse, however has been cracking down significantly on this type of behavior of late: http://corporate.visa.com/media-center/press-releases/press969.jsp [visa.com]
Mastercard will fine and terminate merchants it finds passing CC information between third parties. Fines normally start at 25k per offense.
The storage of CC data is another highly regulated procedure. 'Normal' merchants are prevented from storing CC data, and to even handle it, normally have to become PCI-compliant.
The storage of CVV data is very, very regulated - You have to have PCI-level 3 compliance - something typically reserved for merchant processors themselves.
To say that no regulation exists is somewhat uninformed.
However, even with the above all in place, as these guys are all using merchant accounts, they're going to see all the CC/CVV information in the flux; as presented by the article, it's very common to use this data, if the merchants can 'stay under the radar'.
Smarmy? (Score:5, Informative)
Here's where things really get smarmy.
Excuse me?
Smarmy: unpleasantly and excessively suave or ingratiating in manner or speech
Perhaps the word you were looking for is one of: deceptive, devious, underhand, sneaky, execrable, abhorrent, hateful, annoying, irritating, enraging, infuriating or inexcusable?
It's hard to believe that this practice is legal. I give my credit card details to one company, and it becomes perfectly legal for them to sell these details to a completely unrelated third party, simply because I clicked on an advert on a web site?
Re:Legal but dishonest (Score:3, Informative)
It reminds me of a scam that a site called RedSave.com ran in the UK. Hidden way, way down in the tiny small print of their Terms and Conditions when you made a purchase was a line that stated "We will charge you £20 every month unless you contact us to opt out". Apparently this isn't against the letter of the law, but it sure as hell isn't a good business practice and isn't in the interests of the consumer.
While I don't suspect it's illegal (i.e. the owners of the business aren't going to end up in jail over it), I also don't suspect it's legally enforceable -- i.e. if you take them to court and demand your money back, they'll probably end up having to give it to you. There's a principle of English contract law that when dealing with consumers, the business must call the consumer's attention to anything which is unusual and detrimental to the consumer, otherwise it may not be an eforceable term of the contract. As Lord Justice Denning said:
"The more unreasonable a clause is, the greater the notice which must be given of it. Some clauses which I have seen would need to be printed in red ink on the face of the document with a red hand pointing to it before the notice could be held to be sufficient." (J Spurling Ltd v Bradshaw [1956] 1 WLR 461)
(IANAL, this is not legal advice, but I'd certainly suggest if you paid any money to this company within the last 7 years that you get some...)
JC Whitney is one of these. (Score:2, Informative)
If you need car parts. DO NOT go to JC Whitney. They did this. The company they sold my credit card information to had gone under a dozen different names and phone numbers in the last 6 years. They were investigated by the Better Business Bureau. Everything time the BBB got close they shut their doors changed their name and they were starting right up again. The other company got $9 a month for 6 months before we realized it. I found out through bragging on the other website that they had gotten over 12 million people this way.
Re:PCI? (Score:3, Informative)
I'm pretty sure there's a generally-worded fraud law or something somewhere on the books that would catch this since these guys are basically waiting until you buy one thing and then without knowledge or consent billing you for a second thing.
It's like going to a restaurant, ordering your meal, paying, and then finding out that on the back of one of the fold out flaps in the menu it says you'll also be charged a $150 service charge. You looked at one price, you agreed to one price, and while technically you were "informed" of the second charge in the "fine print" by all reasonable measures you were outright scammed.
Re:For once ... (Score:4, Informative)
Actually they do offer one great function. One time use credit card numbers. these completely bypass any scumbag tricks like this. The credit card number I give a site is good for only the amount I set the number for. Paypad had this feature 3 years ago and I used it on a lot of "iffy" sites. http://www.paypal.com/cgi-bin/webscr?cmd=xpt/cps/account/VDCFrequentlyAskedQuestions-outside [paypal.com]
They call it the virtual debit card.
Pizza Hut? (Score:3, Informative)
You know, you almost come to expect this kind of behavior from scummy web based companies, but really, Pizza Hut? I had to check out their Privacy Policy [pizzahut.com] once I found out they were involved in this action and sure enough it says:
Should you choose to accept an offer from a third party, We will pass your relevant Personal Information, which may include your name, address, and credit/debit card number, to that third party.
Okay Pizza Hut, like, WTF?
Re:So if I use some one else's credit card (Score:3, Informative)
At least in the UK, this type of activity would probably fall foul of the Unfair Contract Terms Act 1977 and the Unfair Terms in Consumer Contracts Regulations 1999, especially if well buried in the small print. There is a decent amount of case law prior to this legislation supporting this as well.
Not that that particularly helps you as an individual, since you'd then need to reverse the card transaction, then risk being sued for it and, finally, asserting that the term was unfair and therefore void in your defence case.
There are powers for certain government bodies like the OFT to take more useful action (such as seeking an injunction against the company in question enforcing those terms) though, which may explain why these scams don't seem to have appeared on reputable UK-centric sites yet.
Best buy used to do this and they got in big troub (Score:3, Informative)
Best buy used to do this and they got in big trouble In more then one way one was the MSN thing where they scan the free disk but don't tell you that you when singed up for a 2 year deal after the free trial ended and some people did not even use the disk and did not know that they when singed up for msn and then was the free magazine when you got singed up for if you did not call up and have it stopped.
Re:PCI? (Score:3, Informative)
Amazon has frequently shipped games more than 1 week after the release. (My friend just got ME2, That long of a wait will steer any gamer away from Amazon for game purchases).
Re:PCI? (Score:3, Informative)
Depends on who is actually running the charge. If it's B&N, for instance, who runs the transaction and then gives the $$$ to the 3rd party minus B&N's kickback, then there is really nothing there against PCI rules. If B&N is giving the 3rd party client all the card info, then there could be some problems. But even then, the big no-no is how the CVV code is handled. So long as it isn't stored anywhere outside of ram and that it is discarded once the transaction is made, the PCI folks don't give a damn as far as I can tell.
Ahhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh!!!!
There, you just made a PCI auditor scream. Are you happy?
If you have full card numbers that is the problem. There are 3 levels of CC data and they get more valuable as their completeness increases. CC#, CC# + CCV, Full Stripe. Full stripe is the most valuable as then you can print new cards. Also if you have ever had the strip on your card not work and had the cashier just punch in the # by hand (ever seen them put in a CCV after they punch in the #?) you know that just a printed card with a "bad" stripe and fake CCV will work at some stores.
All 3 of these MUST BE ADEQUATELY PROTECTED! If your PCI folks only care about CCV... Punch them in the junk for me and for your upper mgmt.
Re:PCI? (Score:4, Informative)
by taste.
Re:PCI? (Score:3, Informative)
Actually he is asking for them to provide information on the method that perform this action. Because it might be implemented in a way that IS illegal.
Part of his job is to sniff out organizations or businesses that appear fishy. Then to request information in regards to it or subpoena it if they refuse and its fishy enough.
They do the same thing all the time to the phone companies when they hear of a practice that does not seem on the level.
Re:So let me see if I have this right.... (Score:5, Informative)
Actually, it can affect you if you don't click the popup too.
It's a major scam, and it's not necessarily a popup.
You click "Continue" on your transaction, and the site summarizes your order. Then instead of a continue button, you have a big button that says "Place order - and get 10% off your next!". What you don't see is hidden in the fine print is a link that says "No thanks - just place my order".
Or, after you place your order, on the thank you page, it'll have a blurb saying "Special offers for your next order" with "Save 10% off your next order!". Hell, the craftier ones put a 10% off discount on your order automatically, and a link hidden at the bottom saying "No, I don't want the discount".
The nastiest ones though are the ones that require no clicking at all - you done your order, you close the browser while inadvertently NOT clicking the "No" link. By closing the window and not declining, you're signed up anyway. Hell, I bet half of them exist in the terms and conditions of sale, and people blindly check the box saying they agree.
Basically, unless you read every word of every screen, it's impossible to not inadvertently do it. It's a huge scam and everyone's hiding behind the fine print. And the fact that people love getting discounts, so a 10% off the next order would be valuable.
Re:PCI? (Score:3, Informative)
You haven't seen these things in action.
They're (often) ads designed to look like coupons that are inserted into the middle of or immediately after the checkout process. I've even seen them placed in order confirmation emails. "Click here to save $10 on that order you just completed." kind of things, with no fine print whatsoever. Some of them will immediately sign you up; others will make you hit at least one additional page before you get screwed over - it depends on how much or little fine print, usually.
At best, it's false advertising. At worst... use your imagination.