How do they (=Venmo) not end up losing court cases over this?
It’s Easy to Get Scammed on Venmo
41–50 of 63 posts
Re: It’s Easy to Get Scammed on Venmo
#42I was surprised to learn that PayPal has 16,000 employees! If I'd had to guess, I would have said something around 1000. I guess there is a lot of manual work involved in handling all those transactions and fraud attempts.
I'd wager that much of their workforce is engineering and integration support, in addition to the redundancy they purchased by buying companies like BrainTree.
Additionally, PayPal owns a massive amount of legacy code and APIs. There are plenty of con talks where PayPal describes how they were mired down in bureaucracy when updating a single line of code in Java (JSP) but managed to flip that overhead on its head by running a NodeJS stack on top of the JSP stack (and in some places replacing it).
Re: It’s Easy to Get Scammed on Venmo
#43Doesn't surprise me that they are owned by Paypal; I know many who have been scammed on Paypal and they have the same kind of nice and friendly policy; 'we don't care, kthnxbye'. I understand they cannot be in business if they wouldn't work like that, however why do they need to be bastards about it? Even if they cannot do anything to help you, they could be sorry for you or at least show some kind of humanity.
Also they don't really seem to work on fraud cases, at least not as far as I can discover; a friend who ran a website selling digital goods (but unique goods so he actually had to buy each himself so fraud was costing him money, not only making him less revenue like it could be if it was software or an ebook) was scammed by the same user a number of times and sure, Paypal cannot give my friend his money but it was very clear this user was a scammer, especially after doing it to one company a number of times and probably to more companies as well...
This seems the same case; if they see this scam happening, why do they still refund? They know it's a scam; that weird remark from Eran Kimchi even says so. So why not screw the scammer instead? The seller always ends up screwed with Paypal. No difference here.
Re: It’s Easy to Get Scammed on Venmo
#44I'm curious if the folk who got scammed w/the e-ticket sales could have waited until the funds are literally in their bank account before they emailed them the tickets. Surely, it is a helluva lot easier to reverse some Venmo balance than it is for Venmo to pull money out of your bank account, so that they can refund a scammer. I've never touched Venmo and now after this, never will touch Venmo and will make sure eve…
No, not really. The scammer can use a stolen Amex card to send payments. When the card is reported stolen and charges reversed, that goes all the way back to the user's bank account. Would be silly of Venmo to do otherwise, as that would be an easy way for them to go out of business.
But why would the bank reverse the transaction? From venmo viewpoint it is quite clear why they would want to reverse it, because they have changed the credit to actual funds. However the bank probably would want to protect their customer, and instead let venmo to take the hit.
Re: It’s Easy to Get Scammed on Venmo
#45Square Cash is my go to over Venmo. Transactions are credited straight to your debit card vs going to a balance and then having to cash out.
Re: It’s Easy to Get Scammed on Venmo
#46Earlier quoted context omitted.
Neither, really. You're technically not allowed to do business on Venmo. The intended use case is to send money to people you trust. If someone sends money they can always get that money back by claiming the recipient violated terms or something.
That's why I did not understand. Buying a ticket on Craigslist is business? Is it supposed to only be used for people who know each other?
The main use cases are for people who are Facebook friends. I really can't fault Venmo too much here because they only deal w/ money. To me, they technically did their job. They protected the people that send the money, not the people who receive.
If you use this platform for potentially sketchy transactions, I'd say it's on the user to protect themselves. When I sell anything on Craigslist, it's always cash only. Even then, there are no guarantees.
Re: It’s Easy to Get Scammed on Venmo
#47What I find interesting is that I don't know anyone here in Australia that uses these payment platforms. I wonder if that's because bank-to-bank transfers are so quick and easy these days? Most of the big banks even have ways of sending _cash_ to other people, to withdraw from any of that bank's ATMs with a code and no card. Anyway, the issue Venmo has here is similar to what banks also have to deal with: in theory y…
Same here in Austria. Bank transfers are free and instantaneous between customers of the same bank, and take one business day to other banks. And they are irreversible.
Nobody needs to use something like Venmo here.
Re: It’s Easy to Get Scammed on Venmo
#48If I understood correctly, the whole damn scam is only possible because this Venmo's terms of service prohibit something called "merchant transactions" and allow for reversing or cancelling transfers if they deem or someone reports a payment to fall in "merchant" category? If so, then the problem is only a completely artificial one and made of mere policy decisions. Venmo could just act as a blind intermediary, no qu…
Banks don't work the way you think, at least in the US. ACH transfers are slow (take a few days to complete), and often expensive. Up until 5 days later, they can be reversed even after both banks agree that they've happend if the sender decides that the payment was "erroneous."
The government can and does impose "some vague policy" on what you can and can't do with your money. If they decide that you have been "structuring" your payments to avoid triggering various reports being generated, that is considered a crime. So making several payments of 9,000 might be illegal even if you've done nothing wrong (you should have done 11,000 so that all the reports could be generated, didn't you know?)
Oh and by the way people can just take money from your account via ACH transfer if they have the correct numbers. You won't get any kind of confirmation, the bank just assumes that nobody would be unwise enough to make an ACH transfer without the consent of the other party. The US generally believes in insecure infrastructure and the 500-pound surveillance and police gorilla to keep everyone in line. It works surprisingly well, to be honest.
Re: It’s Easy to Get Scammed on Venmo
#49Earlier quoted context omitted.
Well I need to set up a new account on that thing and give it my bank details. Then my counterparties have to provide me with their ID on that app which is pretty much the same as providing a bank account number. So I don't get the convenience aspect. I see the value of paypal, which is to create a screen between me and a dodgy website which I am buying from. That website can't get my credit card number and therefore…
Here's my user flow. I sign up and connect w/ Facebook. I connect my bank account. Separately, my friend who I rarely see does the same thing w/ his Facebook account and bank account. A few months later we meet, I pay the full check and he Venmo's me 20$ for the meal w/ a few taps on his phone. He doesn't need to ask me anything. Because we're already Facebook friends, he has access to send me money. I have Bank of A…
I swear sometimes we need to step back and think about things from a general consumer perspective and not one of the analytical early adopter.
Most people wouldn't remember a number like a checking account number nor do they carry checks around with them. Venmo is simple and easy for them to send money to friends without having to log into a bank's shoddily designed website and figuring out how to transfer funds which is probably non-obvious in the first place.
Re: It’s Easy to Get Scammed on Venmo
#50Huh. So what happens (is supposed to happen) to merchants in the event of a chargeback?
* Paypal purportedly credits sellers if the seller proves they shipped / sold something [1]
* Square does not necessarily credit sellers and may pull funds from a bank account [1]. (May have changed since the article?)
* Visa protects merchants from fraud-related chargebacks if the online sale is "verified by Visa"[2]; if not, the merchant may have to suffer the loss. In particular, if the card was physically present, the merchant seems to lose if they screw up any of the little details in the charging process.
* Amazon protects merchants if the transaction occurred according to their policy and the merchant can prove they shipped goods or delivered a service [3]. I imagine if you embed Amazon Payments into your site as it's intended and sell legal stuff, you're fully covered against fraudulent buyers.
So it looks like Venmo (and likely Snapcash) are unique in offering such little fraud protection. Probably due to how their User Agreement works (i.e. they're not meant for merchant selling at all). Also why they can offer no-charge transfer services.
What's probably happened here is that these new services lack regulation and thus have no requirement or incentive to inform users about the consequences of chargebacks. I hate to say we need more regulation, but for Eran Kimchi (Venmo head of fraud) to say "You made an innocent mistake, and you paid for it" is not an acceptable outcome; Venmo is definitely guilty of negligence here.
[1] http://alexshvartsman.com/2014/02/11/screwed-by-square/
[2] page 82 http://usa.visa.com/download/merchants/chargeback-management...