For many years now I’ve just used digital currency I like the benefits such as NO chargebacks or card fraud. Digital currencies like Webmoney, Loom Gold, Pecunix, e-gold and others do not allow ‘in house’ charge backs or reversals. All sales are final.
As a merchant, I can’t think of a better way — than digital currency — to conduct business and not have to worry about fraudsters around the end of each month. As a consumer, no chargebacks can make shopping online a bit tricky, however if buyers investigate their merchants and read the return policies, these no chargeback limitations should not pose a problem for most people. This type of trust between merchant and consumer should only build confidence as any business grows online.
Now, on the other side of the isle are all the credit card fraudsters. Stealing money and merchandise from both merchants and card holders. Who pays for all that theft and loss? Consumers do! Higher transaction fees, higher merchandise prices, insurance, interest charges and that list goes on and on….
So what happens to the whole credit card merchant system, when no one cares to prosecute the thieves anymore? Well….that day is already here.
The Guardian story revealed that due to new laws, the police in the UK are no longer accepting direct reports from credit card victims. Under the new regulation which began in April of this year, its now the responsibility of the bank to determine which credit card crimes will be passed on to the police for investigation. They are allowing the little fish get away and just passing the cost on to consumers.
If your UK Visa card gets used by some fraudster, it might not even get reported to the police as a crime! I suppose if the fraudulent charges are not large enough, ah they will just consider it a CODB (cost of doing business) and pass it on as a higher monthly charges or fees. Amazing!
Last year in the UK, over £430m ($880+mil USD almost a Billion Dollars) went missing because of credit and debit card fraud. That means one in every three UK cardholders is the victim of credit card fraud. I suppose it is now so widespread that the police are simply overwhelmed and don’t want to handle such a large case load. Critics of these new UK regulations are saying that the banks are trying to sweep that figure under a rug by now under reporting the misuse and thefts.
This is amazing situation when a banking or financial authority does not report a crime but passes that cost along to consumers. The police spokesman confirmed that discretion had been handed to the banks to ensure the police could concentrate on cases “more likely to result in a positive outcome”.
“Tory e-crime spokesman James Brokenshire said: “The Government clearly hasn’t got a grip on this issue or an appreciation of the seriousness or scale of the problem.” Sandra Quinn of Apacs (the UK payments association) said the police had not been investigating minor cases before the new rules - which the banks had not requested - came into place. “Unfortunately the police don’t have the resources to investigate all types of card fraud,” she said, adding that hundreds of cases are being reported every month.”
Unfortunately, I cannot find the original story from Thursday June 21, 2007 2:23 AM, the link is now dead, but its available here at money.aol.co.uk and but Dave also mentions it over at Digitaldebateblogs.
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