4 ms·

This is known as "the cost of doing business" and used to be baked into business models. Granted, business models have changed significantly with the rise of th

This is known as "the cost of doing business" and used to be baked into business models. Granted, business models have changed significantly with the rise of the internet and direct individual sales, so maybe it's time for a change. As long as that change still protects consumers from larger businesses with the edge against them.

konschubert 3y ago
You could have efficient legal systems to take care of companies that defraud their customers. And then use payment methods that do not allow chargebacks (And don't cost more than 0.01$ per transaction.)
- londons_explore 3y ago
  The current legal system allows a business to take a customer to court after a customer issues a chargeback and the business loses. I'm actually surprised businesses don't do it more often as a deterrent. At a minimum, they could go win a few easy cases, then tell future customers threatening chargebacks about those cases and the outcome. They could send a simple letter saying "We see you have initiated a chargeback against us. After investigation, we believe this chargeback not to have any merit. In cases of false chargebacks, it is our policy to take clients to court to reclaim our costs, which in past cases have averaged $X on top of the value of the goods.".
  - tyingq 3y ago
    Small businesses would have to travel to the customer's jurisdiction. I don't imagine many cases would meet the risk/reward bar for this.
    - londons_explore 3y ago
      They only need to do a few easy local cases to be able to act as a deterrent.
      - MichaelZuo 3y ago
        How would that deter those who know they are sitting in a far away jurisdiction?
lotsofpulp 3y ago
Larger businesses can afford to simply ban someone for eternity for a chargeback. Also, if fraud is a cost of doing business, then that society is going to start wasting a lot of resources and be less productive than societies with less fraud.
- soco 3y ago
  From what I understand by reading around (I'm not from the US) petty theft in some areas causes already the problem you're mentioning for offline businesses as well.
  - shados 3y ago
    It is. I live in NYC and stopped going to CVS late at night because there is such a looter problem in my neighborhood, I can't buy shit at that time. The looters are there with bags ransacking the isles while I wait behind hoping they leave what I came to buy. Sometimes if it's locked then they can't take that but so still have to wait for them being done to go through the isle lol. I wonder why they keep those stores open sometimes.
    - stephenbez 3y ago
      What neighborhood? I used to live in SF and would see shoplifting all the time but now live in NYC and haven’t seen it that much.
      - jermaustin1 3y ago
        Not OP, but when I lived at 123rd and Lex, the A&P was looted constantly. Like OP, I just stood back and hoped they didn't go after my staples (beans, rice, spices).
      - shados 3y ago
        FiDi. Only after dark (never seen it during the day), and not all of the pharmacies get hit as bad. There is like a million pharmacies around and I've only seen one closed so it can't be that bad, but damn it's annoying. Like, can you leave one bottle of shampoo please?
c2h5oh 3y ago
The cost is passed to the consumer, so it's in everyone's best interest for this to be as rare as possible.
- Retric 3y ago
  Only up to the point where it costs more to prevent than you save.
  - antisthenes 3y ago
    It only costs ~25 cents to stop a robbery.
    - Retric 3y ago
      You can’t get to 0 robberies by spending 25 cents * the number of robberies in the US. You can cheaply discourage someone from robbing you and instead rob someone else. But 0 nationwide would be vastly more expensive.
tyingq 3y ago
It doesn't make it less ridiculous, and doesn't change the incentives it sets up. Since the losses are spread across a bunch of (often small) businesses, scenarios like this where the crime goes unresearched are the norm. I'm not asking for sympathy here, I'm explaining why it's a free for all. It would be fairly easy for the credit card companies to aggregate the data and revoke cards from these people (when there's a pattern) because they have that visibility. Or, if revocation is too hard, give me back a "return fraud risk score" when I do a pre-auth....even if said score has a very high threshold before it shows. But they have no reason to, because it doesn't hurt them in any way.

konschubert 3y ago

You could have efficient legal systems to take care of companies that defraud their customers. And then use payment methods that do not allow chargebacks (And don't cost more than 0.01$ per transaction.)

londons_explore 3y ago
The current legal system allows a business to take a customer to court after a customer issues a chargeback and the business loses. I'm actually surprised businesses don't do it more often as a deterrent. At a minimum, they could go win a few easy cases, then tell future customers threatening chargebacks about those cases and the outcome. They could send a simple letter saying "We see you have initiated a chargeback against us. After investigation, we believe this chargeback not to have any merit. In cases of false chargebacks, it is our policy to take clients to court to reclaim our costs, which in past cases have averaged $X on top of the value of the goods.".
- tyingq 3y ago
  Small businesses would have to travel to the customer's jurisdiction. I don't imagine many cases would meet the risk/reward bar for this.
  - londons_explore 3y ago
    They only need to do a few easy local cases to be able to act as a deterrent.
    - MichaelZuo 3y ago
      How would that deter those who know they are sitting in a far away jurisdiction?

lotsofpulp 3y ago

Larger businesses can afford to simply ban someone for eternity for a chargeback. Also, if fraud is a cost of doing business, then that society is going to start wasting a lot of resources and be less productive than societies with less fraud.

soco 3y ago
From what I understand by reading around (I'm not from the US) petty theft in some areas causes already the problem you're mentioning for offline businesses as well.
- shados 3y ago
  It is. I live in NYC and stopped going to CVS late at night because there is such a looter problem in my neighborhood, I can't buy shit at that time. The looters are there with bags ransacking the isles while I wait behind hoping they leave what I came to buy. Sometimes if it's locked then they can't take that but so still have to wait for them being done to go through the isle lol. I wonder why they keep those stores open sometimes.
  - stephenbez 3y ago
    What neighborhood? I used to live in SF and would see shoplifting all the time but now live in NYC and haven’t seen it that much.
    - jermaustin1 3y ago
      Not OP, but when I lived at 123rd and Lex, the A&P was looted constantly. Like OP, I just stood back and hoped they didn't go after my staples (beans, rice, spices).
    - shados 3y ago
      FiDi. Only after dark (never seen it during the day), and not all of the pharmacies get hit as bad. There is like a million pharmacies around and I've only seen one closed so it can't be that bad, but damn it's annoying. Like, can you leave one bottle of shampoo please?

c2h5oh 3y ago

The cost is passed to the consumer, so it's in everyone's best interest for this to be as rare as possible.

Retric 3y ago
Only up to the point where it costs more to prevent than you save.
- antisthenes 3y ago
  It only costs ~25 cents to stop a robbery.
  - Retric 3y ago
    You can’t get to 0 robberies by spending 25 cents * the number of robberies in the US. You can cheaply discourage someone from robbing you and instead rob someone else. But 0 nationwide would be vastly more expensive.

tyingq 3y ago

It doesn't make it less ridiculous, and doesn't change the incentives it sets up. Since the losses are spread across a bunch of (often small) businesses, scenarios like this where the crime goes unresearched are the norm. I'm not asking for sympathy here, I'm explaining why it's a free for all. It would be fairly easy for the credit card companies to aggregate the data and revoke cards from these people (when there's a pattern) because they have that visibility. Or, if revocation is too hard, give me back a "return fraud risk score" when I do a pre-auth....even if said score has a very high threshold before it shows. But they have no reason to, because it doesn't hurt them in any way.