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And why do you think it is fair to make a bank pay for your fees, someone else's lack of judgement, someone else's breach? Bank did its job and processed the p

by Aspos 4y ago

And why do you think it is fair to make a bank pay for your fees, someone else's lack of judgement, someone else's breach? Bank did its job and processed the payment, why should they be liable for all these? If anything, your example is an illustration why those "protections" should be abolished.

deleted 4y ago
[deleted]
mlyle 4y ago
> And why do you think it is fair to make a bank pay for your fees Because if the bank broke their legal obligations to the customer and the consumer had to use a attorney to recover their money, the attorney deserves to get paid. Banks are expected to know their customer and to take measures to prevent fraud, rather than watching money go by and shrugging because they made a few nickels.
- Aspos 4y ago
  Exactly my point: banks should be responsible for doing the job they are paid for, processing transactions, and should not be liable for someone else's lack of judgement. The fact that it is legal to make banks pay for such things does not mean it is just, moral or ethical.
  - mlyle 4y ago
    We have a few hundred years of legal tradition around banking and commercial transactions, that have been carefully balanced in ways to give everyone involved an incentive to prevent fraud and to produce a system in which the amount of fraud is manageable. Externalizing all the risk out to the individual customers doesn't seem like a preferable system. Banks have done a whole lot of work to make the risks associated with this manageable and even profitable. Consumers are safer, and also it is more reasonable to trust the payment system to have safe outcomes. As a result it is used more, and banks make more money.
    - Aspos 4y ago
      - mlyle 4y ago
        > US banks in average lose 2-4 orders of magnitude more to fraud than banks outside of the US. You think US banks lose 10000x as much to fraud as banks outside of the US? Card fraud in Germany is 0.02% of transaction value. Does that mean it's 200% of transaction value here? Most recent number I have for US is 6.81 cents per $100, or .07%. The regulatory regimes are not too different, between Europe and the US. Banks are legally incentivized to reduce fraud, but even so US banks have resisted anti-fraud measures because they add friction to transactions. Witness them being slow to deploy chips to credit cards and electing not to deploy chip-and-PIN in the US. P.S. I would avoid using the word "retarded", even misspelled.
        Aspos 4y ago
        Correct, 10000x. Some anecdata: I used to work for a bank in Eastern Europe and we once lost a grand total of $6K to fraud one year with about ~1M cardholders. 10000x of that would be $60 per customer per year. Some neobanks here in the US lose more. The point is, all the fraud loses end up being paid for by other customers. So that guy changed his mind, filed a chargeback for a transaction he actually did authorize, and he and his laywer got paid by all other customers who did nothing wrong. And some folks who could have been happily banked ended up unbanked. You are right about your P.S
        mlyle 4y ago
        > Correct, 10000x. Again, this doesn't seem reasonable-- it would indicate losses over 100%. https://www.ecb.europa.eu/pub/cardfraud/html/ecb.cardfraudreport202110~cac4c418e8.en.html https://www.ecb.europa.eu/pub/cardfraud/html/ecb.cardfraudre... Every indication is that Europe has about half the payment card fraud rate of the US-- mostly explained by lower rates of card-present fraud due to use of chip-and-PIN. I was surprised to see Eastern Europe have such a low rate of fraud from an issuing perspective, but it's still about half the European average. From the acquiring perspective, Eastern Europe is *ahem* well-represented in payment fraud. > So that guy changed his mind, filed a chargeback for a transaction he actually did authorize, That is not the facts or situation that the grandparent poster described.
  - datavirtue 4y ago
    Most banks are very loosey goosey. They shrug off his fees and will still go on doing it the same way.
  - biaachmonkie 4y ago
    LOL. I just have to chuckle at trying to bring a moral or ethical argument in favor of banks, given their practices of maximizing of fees they charge to least able to afford them, how they reorder transactions to ensure people go over and they can then extract the most fees.
- redanddead 4y ago
  You're right up to the point where the context is fraud. the bank is not required to process transactions for an impersonator. the opposite in fact, it's supposed to filter out the fraudster's transaction! even if his password leaked, none of that matters. the transaction is valid only between the bank and the individual, any failure in communication between those two is the bank's problem, it just depends on how loud the scammed consumer is willing to be. in China today there are people in Henan province that had their money completely stolen from their accounts... by the bank owner! and who's responsible? the central bank of course, and they will all be repaid, and very fast now because they protested very very loudly https://www.bloomberg.com/news/articles/2022-07-21/china-to-repay-more-victims-next-week-in-biggest-bank-scam https://www.bloomberg.com/news/articles/2022-07-21/china-to-... people should not have to protest for fairness, the money should have never left their accounts, the system should have been perfect src: software engineer designing fintech systems
zacharycohn 4y ago
Because that's the law...
thathndude 4y ago
That question is way above my pay grade. I’m not here to philosophize about the system I exist in. I’m a litigator. The system is defined. The law is defined. I just operate within it. Those types of questions/concerns are well addressed to your Congressperson. I’m merely letting folks know what the system is.
- pwdisswordfish9 4y ago
  > I’m a litigator. The system is defined. The law is defined. I just operate within it. I don't agree with the parent commenter, but I find this view to be widely held among lawyers, and I find it distasteful. A good way to respond to the question: why should banks be subject to this risk? Because ultimately leaks like the one described shouldn't happen, the people affected by them should be swiftly made whole, and it's not hard to see that banks are in a better position to ensure this happens than the individuals themselves. Just because from the consumer's perspective the bank "covered" the losses, there's no reason the bank should be understood to be forced to just eat those costs. If a company like crypto.com is ultimately liable, then the bank can more effectively pursue action, whether there was 1 person affected or if N of their customers suffered losses. In the event that there were multiple customers affected, those losses can be consolidated, and the bank can pursue the ultimately liable party to recover the costs that the bank had to (temporarily) foot the bill for. They're frickin' banks.

by Aspos 4y ago

deleted 4y ago

[deleted]

mlyle 4y ago

> And why do you think it is fair to make a bank pay for your fees Because if the bank broke their legal obligations to the customer and the consumer had to use a attorney to recover their money, the attorney deserves to get paid. Banks are expected to know their customer and to take measures to prevent fraud, rather than watching money go by and shrugging because they made a few nickels.

Aspos 4y ago
Exactly my point: banks should be responsible for doing the job they are paid for, processing transactions, and should not be liable for someone else's lack of judgement. The fact that it is legal to make banks pay for such things does not mean it is just, moral or ethical.
- mlyle 4y ago
  We have a few hundred years of legal tradition around banking and commercial transactions, that have been carefully balanced in ways to give everyone involved an incentive to prevent fraud and to produce a system in which the amount of fraud is manageable. Externalizing all the risk out to the individual customers doesn't seem like a preferable system. Banks have done a whole lot of work to make the risks associated with this manageable and even profitable. Consumers are safer, and also it is more reasonable to trust the payment system to have safe outcomes. As a result it is used more, and banks make more money.
  - Aspos 4y ago
    - mlyle 4y ago
      > US banks in average lose 2-4 orders of magnitude more to fraud than banks outside of the US. You think US banks lose 10000x as much to fraud as banks outside of the US? Card fraud in Germany is 0.02% of transaction value. Does that mean it's 200% of transaction value here? Most recent number I have for US is 6.81 cents per $100, or .07%. The regulatory regimes are not too different, between Europe and the US. Banks are legally incentivized to reduce fraud, but even so US banks have resisted anti-fraud measures because they add friction to transactions. Witness them being slow to deploy chips to credit cards and electing not to deploy chip-and-PIN in the US. P.S. I would avoid using the word "retarded", even misspelled.
      - Aspos 4y ago
        Correct, 10000x. Some anecdata: I used to work for a bank in Eastern Europe and we once lost a grand total of $6K to fraud one year with about ~1M cardholders. 10000x of that would be $60 per customer per year. Some neobanks here in the US lose more. The point is, all the fraud loses end up being paid for by other customers. So that guy changed his mind, filed a chargeback for a transaction he actually did authorize, and he and his laywer got paid by all other customers who did nothing wrong. And some folks who could have been happily banked ended up unbanked. You are right about your P.S
        mlyle 4y ago
        > Correct, 10000x. Again, this doesn't seem reasonable-- it would indicate losses over 100%. https://www.ecb.europa.eu/pub/cardfraud/html/ecb.cardfraudreport202110~cac4c418e8.en.html https://www.ecb.europa.eu/pub/cardfraud/html/ecb.cardfraudre... Every indication is that Europe has about half the payment card fraud rate of the US-- mostly explained by lower rates of card-present fraud due to use of chip-and-PIN. I was surprised to see Eastern Europe have such a low rate of fraud from an issuing perspective, but it's still about half the European average. From the acquiring perspective, Eastern Europe is *ahem* well-represented in payment fraud. > So that guy changed his mind, filed a chargeback for a transaction he actually did authorize, That is not the facts or situation that the grandparent poster described.
- datavirtue 4y ago
  Most banks are very loosey goosey. They shrug off his fees and will still go on doing it the same way.
- biaachmonkie 4y ago
  LOL. I just have to chuckle at trying to bring a moral or ethical argument in favor of banks, given their practices of maximizing of fees they charge to least able to afford them, how they reorder transactions to ensure people go over and they can then extract the most fees.
redanddead 4y ago
You're right up to the point where the context is fraud. the bank is not required to process transactions for an impersonator. the opposite in fact, it's supposed to filter out the fraudster's transaction! even if his password leaked, none of that matters. the transaction is valid only between the bank and the individual, any failure in communication between those two is the bank's problem, it just depends on how loud the scammed consumer is willing to be. in China today there are people in Henan province that had their money completely stolen from their accounts... by the bank owner! and who's responsible? the central bank of course, and they will all be repaid, and very fast now because they protested very very loudly https://www.bloomberg.com/news/articles/2022-07-21/china-to-repay-more-victims-next-week-in-biggest-bank-scam https://www.bloomberg.com/news/articles/2022-07-21/china-to-... people should not have to protest for fairness, the money should have never left their accounts, the system should have been perfect src: software engineer designing fintech systems

zacharycohn 4y ago

Because that's the law...

thathndude 4y ago

That question is way above my pay grade. I’m not here to philosophize about the system I exist in. I’m a litigator. The system is defined. The law is defined. I just operate within it. Those types of questions/concerns are well addressed to your Congressperson. I’m merely letting folks know what the system is.

pwdisswordfish9 4y ago
> I’m a litigator. The system is defined. The law is defined. I just operate within it. I don't agree with the parent commenter, but I find this view to be widely held among lawyers, and I find it distasteful. A good way to respond to the question: why should banks be subject to this risk? Because ultimately leaks like the one described shouldn't happen, the people affected by them should be swiftly made whole, and it's not hard to see that banks are in a better position to ensure this happens than the individuals themselves. Just because from the consumer's perspective the bank "covered" the losses, there's no reason the bank should be understood to be forced to just eat those costs. If a company like crypto.com is ultimately liable, then the bank can more effectively pursue action, whether there was 1 person affected or if N of their customers suffered losses. In the event that there were multiple customers affected, those losses can be consolidated, and the bank can pursue the ultimately liable party to recover the costs that the bank had to (temporarily) foot the bill for. They're frickin' banks.