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The issue is Facebook denying refund requests after children were suckered in to make large in-game payments using their parents' stored credit cards. It's not

The issue is Facebook denying refund requests after children were suckered in to make large in-game payments using their parents' stored credit cards. It's not just that this whole scenario is slimy. It's that Facebook was fully aware of it, had a nice in-house term for it ("friendly fraud"), and not only chose not to approve refunds but also chose not to implement the most basic measures to prevent it. [edit: as a commenter pointed out, the term “friendly fraud” predated Facebook] This is symptomatic of a corporate culture that is toxic to to the core. The money quotes are in the 2 paragraphs below: "In 2011, Tara Stewart, a risk analyst for Facebook, studied the issue and suggested that the company begin requiring users to enter the first six digits of a credit card used for payments on certain games. Stewart ran a survey of Facebook users and found that many parents were not aware that Facebook stored their payment information after entering it one time. They also found that the kids weren’t aware of what they were doing. “It doesn’t necessarily look like ‘real’ money to a minor,” Stewart wrote. She ran a test to see if the entering the cards first six-digits would reduce these unwanted charges and the results were encouraging. She also said it would “make sense to start refunding for blatant FF-minor.” The abbreviation “FF” stood for “Friendly Fraud,” the term Facebook used to refer to these fraudulent purchases which were made without malicious intent. Despite this obvious solution, Facebook decided that it would harm revenue and elected to continue fighting refund requests for the foreseeable future, the documents show."

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endofcapital 8y ago
I'm not sure which class at business school is teaching everyone that "If you can get away with it do it! Have zero shame!" because it's probably time to remove that one from the Harvard curriculum.
- ben_jones 8y ago
  No, no, no. This isn't taught in college. It's taught in Elementary School when students learn about the world leaders and take two seconds to discover their actual backgrounds and where their power and wealth truly came from. It's learned while watching movies like Wolf of Wall Street where the beautiful protagonist fucks everybody else, living a lavish and perceivable happy lifestyle, before getting "caught" and suffering virtually zero consequences for his or her actions. Then, after being learned at an early age, it is reinforced time and time again in the stories of entrepreneurs who make billions immorally and similarly suffer zero consequences.
  - muthdra 8y ago
    I agree with you but I would like to point out that this is not Elementary School's fault. It's society's fault and Elementary School is when we first see the effects of this phenomenon, also some (most?) people will only get out from their caves at a later point in their lives.
    - dgzl 8y ago
      Agreed. Local relevance outweighs global arrogance.
  - AlexandrB 8y ago
    The fact that people watch Wolf of Wall Street and read it as an example to be emulated is very telling. By the end of the movie he’s in a hateful, bitter relationship, crashing cars into shit because he’s strung out on quaaludes and yet this is called “virtually zero consequences” because the consequences are not coming from an external authority. It’s the substitution of paternalism for morals and money for happiness.
leereeves 8y ago
> “It doesn’t necessarily look like ‘real’ money to a minor,” This is intentional. In many games, some things cost "gold" earned by playing the game, and others cost "gems" bought with real money. Or maybe "gold" is the one that costs real money. It's designed to be confusing and hide the distinction between in-game points and real money. At some point the game companies should bear some of the responsibility for deceiving children.
- Vanit 8y ago
  You're right, but I don't think this is quite what the quote is referencing. If payment details are stored and kids are merely presented with a colourful popup confirming they want to spend $99 for 2000 gems, it doesn't seem like a real transaction to them (putting aside the fact most kids have no appreciation for the value of money).
- AlexandrB 8y ago
  > At some point the game companies should bear some of the responsibility for deceiving children. I hope a reckoning is coming in this regard. Many games include mechanics that are hard to distinguish from video slot machines and should be regulated the same way gambling is (rated 18+, audited for "fairness").
  - bytematic 8y ago
    When I followed the Valve game CS:GO a few years ago, I was pretty disgusted by the gambling done in that game. It made up an insane % of players, many of them children, who would bet weapon skins on third party websites based on ESports games. Valve shut those third party sites down but continued to market different kinds of skins such as gloves, music, etc. I wonder how much money moved to and away minors during that period.
    - knome 8y ago
      I believe it was Belgium that banned unboxing as a form of gambling, leading to it being disabled across Valve games, afaik.
squarefoot 8y ago
"They also found that the kids weren’t aware of what they were doing. “It doesn’t necessarily look like ‘real’ money to a minor,” Seems a way to create the best consumer ever: someone who gets the benefits while having no connection with the costs. It may seem stretched, but I see some parallels with military drone pilots.
austincheney 8y ago
> not to implement the most basic measures to prevent it. The most basic implement to prevent this behavior is for parents to limit their children's access to Facebook. The consequence for that lack of supervision is spent money. Who should we feel sorry for?
- Jare 8y ago
  Feel sorry for parents who are struggling to keep up with a crazily fast technology uptake for which they are not prepared but which has many high impact features in their profession, in their spare time, and in their kids' lives. If you know parents without tech education or a comfortable economic position and lifestyle, try asking them how the deal with all this stuff.
  - austincheney 8y ago
    Do you think parents should limit their children's access to porn? In my household we limit social media access no differently. What parent (with Facebook and integrated credit card data) doesn't know what social media is at this point?
- WilliamEdward 8y ago
  You are correct, but no chargebacks is a scummy policy that makes Facebook in the wrong here.
- u801e 8y ago
  > The most basic implement to prevent this behavior is for parents to limit their children's access to Facebook. Another one would be not to store payment information on Facebook. Even if my child was able to get onto my facebook account, they wouldn't be able to buy anything because I've never stored my payment information on that service.
dgzl 8y ago
> The issue is Facebook I agree.
bigbugbag 8y ago
Are you really surprised ? To me this seems exactly as intended and expected from facebook, this is fully in line with how facebook thinks and works. Everything facebook is designed to maximize profit in any possible way out of people not knowing better. The scheme described in this article is akin to the multiple techniques used by facebook to acquire users, they used and abused the whole black book of dirty tricks, dark patterns and such. Heck there's even one dark pattern named after the ceo and founder of facebook.
bobthepanda 8y ago
I wonder what logic the first 6 would be, as opposed to the first 4. Credit cards, at least in America, have numbers composed of blocks of four digit numbers.
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- thiagocsf 8y ago
  The first 4 digits are pre-assigned prefixes so it’s very easy to find valid ones; e.g.: visa starts with 4, MasterCard with 50-55 etc (https://creditcardjs.com/credit-card-type-detection https://creditcardjs.com/credit-card-type-detection). The remaining digits have an error check built in so you can’t “guess” them. Back in the offline transaction days, use of fake (generated) credit card numbers as prevalent in computer BBS to get an account for 1 day. Not that I ever did that sort of thing.
  - hakfoo 8y ago
    The whole number is used in the checksum calculation (the Luhn algorithm). The last digit is basically the checksum. The first six digits will identify an issuing bank and card type. All Chase Debit Visas will start with the same six digits (unless they've further broken it down), but no Citibank one will use them. It's still plenty guessable-- try the most popular prefixes and you'll probably hit a few percent of the time. It might be based in PCI regulations. They might be allowed to store or display the first six/last four in plain text, but probably have to encrypt the whole number or store a token in lieu of the actual full card number.

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endofcapital 8y ago

I'm not sure which class at business school is teaching everyone that "If you can get away with it do it! Have zero shame!" because it's probably time to remove that one from the Harvard curriculum.

ben_jones 8y ago
No, no, no. This isn't taught in college. It's taught in Elementary School when students learn about the world leaders and take two seconds to discover their actual backgrounds and where their power and wealth truly came from. It's learned while watching movies like Wolf of Wall Street where the beautiful protagonist fucks everybody else, living a lavish and perceivable happy lifestyle, before getting "caught" and suffering virtually zero consequences for his or her actions. Then, after being learned at an early age, it is reinforced time and time again in the stories of entrepreneurs who make billions immorally and similarly suffer zero consequences.
- muthdra 8y ago
  I agree with you but I would like to point out that this is not Elementary School's fault. It's society's fault and Elementary School is when we first see the effects of this phenomenon, also some (most?) people will only get out from their caves at a later point in their lives.
  - dgzl 8y ago
    Agreed. Local relevance outweighs global arrogance.
- AlexandrB 8y ago
  The fact that people watch Wolf of Wall Street and read it as an example to be emulated is very telling. By the end of the movie he’s in a hateful, bitter relationship, crashing cars into shit because he’s strung out on quaaludes and yet this is called “virtually zero consequences” because the consequences are not coming from an external authority. It’s the substitution of paternalism for morals and money for happiness.

leereeves 8y ago

> “It doesn’t necessarily look like ‘real’ money to a minor,” This is intentional. In many games, some things cost "gold" earned by playing the game, and others cost "gems" bought with real money. Or maybe "gold" is the one that costs real money. It's designed to be confusing and hide the distinction between in-game points and real money. At some point the game companies should bear some of the responsibility for deceiving children.

Vanit 8y ago
You're right, but I don't think this is quite what the quote is referencing. If payment details are stored and kids are merely presented with a colourful popup confirming they want to spend $99 for 2000 gems, it doesn't seem like a real transaction to them (putting aside the fact most kids have no appreciation for the value of money).
AlexandrB 8y ago
> At some point the game companies should bear some of the responsibility for deceiving children. I hope a reckoning is coming in this regard. Many games include mechanics that are hard to distinguish from video slot machines and should be regulated the same way gambling is (rated 18+, audited for "fairness").
- bytematic 8y ago
  When I followed the Valve game CS:GO a few years ago, I was pretty disgusted by the gambling done in that game. It made up an insane % of players, many of them children, who would bet weapon skins on third party websites based on ESports games. Valve shut those third party sites down but continued to market different kinds of skins such as gloves, music, etc. I wonder how much money moved to and away minors during that period.
  - knome 8y ago
    I believe it was Belgium that banned unboxing as a form of gambling, leading to it being disabled across Valve games, afaik.

squarefoot 8y ago

"They also found that the kids weren’t aware of what they were doing. “It doesn’t necessarily look like ‘real’ money to a minor,” Seems a way to create the best consumer ever: someone who gets the benefits while having no connection with the costs. It may seem stretched, but I see some parallels with military drone pilots.

austincheney 8y ago

> not to implement the most basic measures to prevent it. The most basic implement to prevent this behavior is for parents to limit their children's access to Facebook. The consequence for that lack of supervision is spent money. Who should we feel sorry for?

Jare 8y ago
Feel sorry for parents who are struggling to keep up with a crazily fast technology uptake for which they are not prepared but which has many high impact features in their profession, in their spare time, and in their kids' lives. If you know parents without tech education or a comfortable economic position and lifestyle, try asking them how the deal with all this stuff.
- austincheney 8y ago
  Do you think parents should limit their children's access to porn? In my household we limit social media access no differently. What parent (with Facebook and integrated credit card data) doesn't know what social media is at this point?
WilliamEdward 8y ago
You are correct, but no chargebacks is a scummy policy that makes Facebook in the wrong here.
u801e 8y ago
> The most basic implement to prevent this behavior is for parents to limit their children's access to Facebook. Another one would be not to store payment information on Facebook. Even if my child was able to get onto my facebook account, they wouldn't be able to buy anything because I've never stored my payment information on that service.

dgzl 8y ago

> The issue is Facebook I agree.

bigbugbag 8y ago

Are you really surprised ? To me this seems exactly as intended and expected from facebook, this is fully in line with how facebook thinks and works. Everything facebook is designed to maximize profit in any possible way out of people not knowing better. The scheme described in this article is akin to the multiple techniques used by facebook to acquire users, they used and abused the whole black book of dirty tricks, dark patterns and such. Heck there's even one dark pattern named after the ceo and founder of facebook.

bobthepanda 8y ago

I wonder what logic the first 6 would be, as opposed to the first 4. Credit cards, at least in America, have numbers composed of blocks of four digit numbers.

deleted 8y ago
[deleted]
thiagocsf 8y ago
The first 4 digits are pre-assigned prefixes so it’s very easy to find valid ones; e.g.: visa starts with 4, MasterCard with 50-55 etc (https://creditcardjs.com/credit-card-type-detection https://creditcardjs.com/credit-card-type-detection). The remaining digits have an error check built in so you can’t “guess” them. Back in the offline transaction days, use of fake (generated) credit card numbers as prevalent in computer BBS to get an account for 1 day. Not that I ever did that sort of thing.
- hakfoo 8y ago
  The whole number is used in the checksum calculation (the Luhn algorithm). The last digit is basically the checksum. The first six digits will identify an issuing bank and card type. All Chase Debit Visas will start with the same six digits (unless they've further broken it down), but no Citibank one will use them. It's still plenty guessable-- try the most popular prefixes and you'll probably hit a few percent of the time. It might be based in PCI regulations. They might be allowed to store or display the first six/last four in plain text, but probably have to encrypt the whole number or store a token in lieu of the actual full card number.