Stealing Millions 25 Cents At A Time | Hacker News Reader

Stealing Millions 25 Cents At A Time

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71 pointsChirag53 comments

I don't remember the exact details but there was a story making rounds about a company that sent out $25 average-looking invoices to large and very large companies, with each invoice saying "Invoice for nothing". Most companies didn't pay, and still these fellas made a LOT of money on those few that did. The best part was that the scheme was 100% legal.

Doesn't sound 100% legal to me.

I'm not a lawyer, but I'd claim that the mere existence of an invoice is a statement that money is owed. Since money is not owed, and the creator of the invoice knows that it's not, that makes this fraud. The fact that it says that the debt is for "nothing" is irrelevant, since it's clearly intended to defraud.

It sounds like the creators subscribe to a "magic words" theory of the law.

You could probably phrase it like the non-cheque junk mail that I get. It looks like a cheque (for all I know, maybe it is) but there is fine print stating that if you cash this, then you sign up for a membership of some sort.

IIRC, I've also seen "this is not a bill" junk mail that looks like a bill. I'd imagine that these are skirting close to the edge of the law as well.

You’re right: it is indeed fraud. The OP is wrong saying it’s legal. It’s called false billing.

http://en.wikipedia.org/wiki/False_billing

There's a company called 'Domain Registry of Canada' that looks for .ca registered domains that are about to expire and sends a form letter telling you that you should renew, and to fill in the form, check the box, and enclose a cheque to make sure your domain stays active.

What the form ACTUALLY is is a transfer request, which will transfer your domain to them, at a rate of likely twice what you're paying already. It says this in the fine print, but if I didn't know who my registrar was already I might not have noticed (good thing I don't send cheques to people).

It's the shadiest kind of business, and while I believe it may be technically legal, they're taking advantage of customer confusion. I'm sure they make a ton of money with this sort of thing.

There is a similar company (probably same people) in the US "Domain Registry of America" which sends out these "bills" to protect your domain from lapsing for $25/year.

My guess is that company easily gets 100-250k renewals/transfers a year that way. Most likely way more.

My dad fell for that. Twice.

Man I hate those people.

I get these except in my case they're sent from USA over the pond to me. It's clearly profitable if it's worth sending snail-mail spam that far.

Yup. I got one of those in Australia as well.

It's not just .ca domains, I got one from them for a .com recently. The contact information is a Canadian address though.

Would anybody here take the time to dispute a $0.25 charge? I wouldn't...

This also reminds me of something that I have wanted from credit card companies for a very very long time...imagine if there was a protocol for the CC companies to accept a record of not only the amount, but also the transaction that you made? Basically the CC machine sends a copy of the receipt to the card processor...

Carrying around paper receipts in my wallet for doing expense reports is a massive pain in the ass.

A friend and I had kicked around a startup idea where you would take a picture of your receipt with your phone and upload it to our service. Then it would do OCR, and at the end of the month, you could easily reconcile your statement with the receipts you took pictures of. One benefit is that you don't have to trust the credit card company, or the merchant you buy from, which is a problem of your proposed system.

Is the resolution of most cell-phone cameras good enough for this?

I frequently use my phone to take pictures of stuff I would normally just write down (error message after a kernel panic, asset tag, where I parked my car, etc. etc.), but for things the size of a receipt, I can't read it...

What phone were you using?

I routinely use my iphone 3gs to take photos of things like that; my glasses and contact prescriptions live in my phone as images, I'm not even certain where the originals are now.

I'm guessing that anything that's come out around the same time would do fine in good lighting.

For example, the iphone 4 has a 5 megapixel camera.

My Nokia N86 8mp certainly is :) (though it has some trouble focusing at short range).

I expect cell phone cameras like that will become commonplace in the next year or so, so it's a good time for startups to abuse that.

check out shoeboxed.com i think they have this as part of their service. great idea nonetheless.

I remember a few months back some guys here on HN forming a startup based on this concept. Can't find any links. Maybe they are YC funded as well.

I disputed a $0.10 charge with my ISP and got it taken off the bill.

I scan all my receipts every couple of days and dump them in Evernote.

Then I simply run down all my transactions on the CC bill once a month and search Evernote for the dollar amount. So if my CC bill says I spent 40.65 at Walmart, I type in 40.65 into Evernote, and sure enough, there's the receipt.

I save about $70 a year doing this and it takes all of about five minutes a month.

You get $70 worth of bogus charges per year?

You'd be surprised how many "innocent" one-digit typos there are.

wow I didn't know about that. Time to start looking at the bills more closely. Thanks

how much time does it take to protect that $70 per year?

is it fair compensation for your time, or mostly for peace of mind.

For me (although I don't do this) it's matter of principle. For example, companies that send me spam catch a nerve.

Here's my thing with spam: it's cheap or, in the eyes of most PHBs, free. When you send me a spam, what you're saying to me as a potential customer is "You're not valuable enough for me to take 30 seconds and pick up a phone to call you. Instead, I'm going to monopolize a few seconds of your time every day so that you have to see my name while you're deleting things from your inbox."

It's incredibly rude, incredibly disrespectful, and it really ticks me off. So if a company that I do business with adds me to their "waste this person's time" list, I'll take a few minutes to send an email to my rep asking for them to explain why they value me so little.

Is this a waste of 5 minutes? Would it be easier to just write a spamassassin rule to filter this stuff out?

Yeah, probably, but it makes me feel good; it's the principle of it.

I suggest GP is the same way...

s/suggest/suspect/

I remember reading about replying to all offers that have business reply mail, and putting heavy things (like strips of lead) in the envelope so they would have to pay the postage charge - but still wouldn't get your information.

I love the idea, but am not willing to take the time. If there were some (legal) way to guarantee this would happen on a massive scale I'd be game.

I'm wondering: are there any errors in your favour at all?

A few. Seems to be about a tenth of the ones not in my favor.

Seriously? I check all my credit card statements pretty carefully and the only errors I ever found were two double charges in the past 10+ years. I just don't believe errors are that common.

It generally costs $2.50-$3.00 for cash withdrawls using out-of-network ATM machines. So I doubt I'd take the time either.

I know it should be taken seriously, and I probably would report it if I caught it, but it's more like a leak than a theft.

i did. sort of. i have a credit card that i save in cases of emergencies, and i noted one day on mint that it started getting very small, random charges. i literally hadn't used it at all in several years. i decided that calling the fraud department would only be slightly more of a hassle than paying a bill i wouldn't normally pay, so i reported the activities.

I used to do inbound customer service for a very large phone company, and I was on a line dedicated for people who were calling to dispute an 83 cent charge. I got plenty* of calls on that line from very angry customers.

* the 83 cent charge was passed on to the consumer by the phone company. It was to cover a large fee the FTC made them pay.

PETER This sounds familiar.

MICHAEL Yeah. They did this in Superman III.

PETER Yeah. What a good movie.

It is sort of like spam and/or snail mail solicitations. It's so "inexpensive" for people (victims) to ignore that it becomes a simple exercise in basic profit equations for the sender.

http://en.wikipedia.org/wiki/Salami_slicing

More reasons why banks / credit cards should be issuing restricted-value, one-time-use card numbers for purchases. Or at least the option to do so. Easier to control and revoke, and easier to identify fraud like this (a number 4 years out of date? * flags go up * ).

They do. http://en.wikipedia.org/wiki/Controlled_payment_number

I use it all the time.

Where "they" is a rather small subset of the world's banking / credit card-ing. I suppose I should've said "more banks", it does sound like I don't know of its existence.

But yes, that's pretty much precisely what I'd like, though it should be everywhere, and really should've been there from the start. Abuse like this is a rather obvious possibility if there's no way to control what merchant X can do. Looks like Mastercard may come out with it soonish, hopefully Visa & others will do so as well.

Discover has had a little Flash app for generating one-time-use numbers for many years now.

Office Space, anyone?

read all the above comments just to see if anyone posted this one.

http://www.youtube.com/watch?v=wzGWvZAd228

Before I clicked through I thought this article was about how banks charge a fee for every electronic debit card transaction that they process. Then I realized most banks in Canada charge $0.50 at a time.

Really? For ~$12/mo I get unlimited debit card uses, ATM withdrawls, online bill payment, and teller transactions. I can't remember the last time I paid service charges.

The last time you paid a service charge was the last time you gave your bank $12.

Even if you got dinged $2 per ATM withdrawal you could take money out once a week and pay less in fees. Your situation sounds like highway robbery to me.

$12 per month for a debit card, four bank accounts, unlimited transactions, good ATM coverage, branches open until 8 PM every day, friendly service. Sounds pretty good to me.

Also, your suggestion would imply that I should only spend cash, presumably meaning that I take out huge sums of money once a week at the ATM, then spend the week having to juggle cash, change, etc. It's not worth the hassle at all. The fact that debit cards are the most common method of payment in Canada seems to imply most people agree with me.

I'm pretty sure the parent post is talking about charges made to those receiving money from you, eg retailers, and not to charges made on consumers directly.

You have to pay for electronic transactions? I guess because the majority of transactions here (NZ) are electronic, I'm used to it being the de facto way to pay.

There is no service charge or monthly fee.

You get dinged only if you do anything requiring human interaction, like going into a branch and performing a transaction through a teller.

Site is down, anyone have a copy? It seems to refer to this article, though:

http://www.computerworld.com/s/article/9178560/FTC_says_scam...

Capital One once put a hold on my CC for a $0.63 charge from Amazon (my S3) bill. I thought it was very strange especially since they never acted on my $0.19 changes for S3 the 6 six months prior.

This seems like a great opportunity for Mint.com. Just flag any known fraudulent companies in everyone's personal report.

When I first saw the title I assumed it was about Wall Street.

I kid you not.

Apparently Verizon Wireless does the same thing. I heard they charge randomly users (claiming that you click on the Internet icon and got connected) and this ends up being in the hundreds of millions of dollars. I have no evidence of this, but I tend to believe it.

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