Topic: Anti-Fraud Team -- Help Wanted - page 4. (Read 8528 times)

PayPal and bitcoin doesn't mix. Don't try it. It's a losing match.

You're asking for donations before you've created anything ?

Hm...

Victim relief has two huge problems.

It will be scammed unless you run it very conservatively. Which will mean asking victims tons of info and then still mistakenly rejecting some actual victims.

Then if it does somehow become an effective and meaningful remedy it will lower the incentive to avoid being scammed and (potential) victims behaviors are nearly the only thing that determines how much scamming happens.

I found out it wasn't a tor exit node - hence the comment that the hacker could be slipping up, although valid point that it might be a VPN, proxy or botnet slave. However, it being not a tor exit node greatly increases the chance of this hacker getting caught.

You're spot on. I understand from my experience that a lot of the chargebacks are genuine people who had their account hacked. The problem is a lot of people are unaware their computers are compromised. Maybe the anti-fraud group should campaign for better understanding of computer security, safe AV and Internet practices?

It's something that affects bank users and bitcoin users alike. I was thinking of something like for every chargeback that happens, we could lobby banks to ensure that they fix their customers computer rather than just change their password. I know that's a big ask, but maybe we could facilitate the fix through bitcoin payments and remote access? Thinking out aloud here but we have the tech know how and their customers have $.

EDIT:
I just realised the bank are probably not at all interested in helping their customers in this way - they might think they've solved the problem with One Time Password. I think a good strategy is to educate people who enter bitcoin and show them that our community supports them in ways their bank would rather not deal with.

good luck with the anti-fraud concept. just be sure that others wont just set up 2 account , cargeback to themselves and then show you evidence of a chargeback to then get some free bitcoins.

the best bet is not to set up a donations pot aiming at giving funds to people that lost out, as that will get abused. but to develop relationships with paypal, and get one long term employee of theirs to understand the blockchain and use the blockchain info as 'proof of delivery'. then all sellers can contact that informed paypal contact to review the transaction information to avoid chargebacks.

I'm with you on this, tip sent.

I got a chargeback through the bank and I ended up finding out the hackers ip address - so you're right they're not being very clever.

I haven't heard anything from the bank yet after asking them to inform me if they catch the person responsible. I don't think they care much at all about catching hackers, even when given their ip address!

I would like to be part of an anti-fraud lobby group that tries to bring scammers to justice. Will contact my bank again tomorrow to get an update.

This is the only way I see to sell BTC on eBay without getting defrauded: http://www.ebay.com/itm/230902604519

Today I became fully aware of the massive amount of charge-back fraud perpetrated against Bitcoin sellers who accept any type of reversible payment method (esp. Paypal). We are newcomers to the Bitcoin world, and we learned our lesson the hard way about this. A fraudulent buyer spent around $27 on Bitcoin and is trying to reverse the Paypal payment on us. This is a small amount of money, but now after talking to others about this and other merchants who have been the victim of charge-back fraud we are very scared and have completely halted all Bitcoin transactions through Paypal. The problem is so bad that you simply don't know who is going to hit you; scammers hijack legitimate accounts, purchase Bitcoin and slip away. On eBay they also create new accounts, buy lots of cheap "trinkets" (e.g., cellphone cases, keychains, etc) from high-volume sellers, get high feedback scores then attack.

To my knowledge, Paypal does nothing about it -- they might close the scammer's account but there are many more to replace it and the honest merchants can be forced to bear the cost. Totally uncool, Paypal... Some say it is against the Paypal ToS to make Bitcoin transactions, but I'm not sure this is necessarily true. After reading their merchant ToS again today I didn't see anything restricting transactions involving digital goods/media, intangibles or Bitcoin. However, there is an "unofficial" policy of giving the finger to Bitcoin merchants because Paypal sees Bitcoin as a threat to their monopoly over online payments. It depends on who you talk to and what division of Paypal they're in. They tend to let you get along fine selling Bitcoin, but when something goes wrong they abandon you. The bad part is that eBay and Paypal's system misleads sellers into thinking they're dealing with a legitimate buyer when they're really dealing with a crook.

The higher profits to be had from selling Bitcoin over eBay or through Paypal is NOT worth the risk -- in fact, it raises the risks for the seller!

A lot of people, especially those who've been in the Bitcoin community a while, say this is no news to them; they've been aware of this. But my warning here is to make the less-experienced and aspiring Bitcoin merchants aware of the danger. My advice is simply don't try. There's a reason why Mt Gox and many big Bitcoin companies won't accept Paypal or credit cards: everyone who has tried it got screwed. Though it's embarrassing, we unwittingly added ourselves to the list of people screwed by charge-back fraud. Fortunately we quit while we're only $30 down and there's not a huge amount of money at risk...  

Since this happened to us we've begun investigating the scammer and looking into every other transaction we've made through Paypal. I've reached out to other sellers engaging in Bitcoin trade through eBay and Paypal and I'm shocked at how bad this problem is. One girl I talked to today got screwed out of a lot of money and is having to sell all of her nice gold and silver jewelry to try to make up for it. She's a single mother with a very young daughter.

Now I am furious... I'm furious, of course, at the scammers who've done this to people... But I'm also very angry with Paypal and eBay for allowing scammers to attack their merchants and get away scott-free: the people they make their money from and rely on to survive. I'm also furious that they have a "screw you" attitude toward Bitcoin merchants. This isn't the fault of Bitcoin: anyone selling valuable items that are easy to get cash for can be a target (whether you're selling gold, Rolex watches or Gucci sunglasses).

Some of you may remember this post I made recently about community collaboration to fight fraud and unethical business practices. Now that I've been hit with my first small loss to a Bitcoin scammer and talked to real, ordinary people who have been screwed very badly by the scammers (and Paypal's handling of the situation) I am ready for action... ready to follow through with my own proposals to help fight fraud, as some of you suggested I do, personally. I've already launched a private investigation into this matter, working together with victims and merchants, and much of what I've found is startling. These scammers are making mistakes -- they're arrogant, probably young and dumb and think they can screw people and never be held accountable because Bitcoin is "anonymous"... WRONG! Bernie Maddoff was caught, and these clowns can be caught too.

We want to do everything we can to prevent more people losing money to scammers and trying to help people get their money back, whether that means catching the perpetrators to hold them accountable and/or pressuring eBay and Paypal to do the right thing and step up to protect their merchants. So we will be part investigator and part advocate. I am assembling a new "anti-fraud team" and I'd like to launch a new organization with a website, forums and advocacy group.

If anyone would like to help us make the Bitcoin world safer please say the word! You can join forces with us, do some nosing around on your own time, give suggestions/advice, help us fight for victims of fraud or donate. If you want to donate a little to help pay for a website and getting an anti-fraud/watchdog team going please send to this address:

Anti-fraud team donations:
1Cr3MTEQxruNimtdCBbUBvDtZFmcW7gHSs

We're serious and we're going to follow through and do everything we can. And you can scoff at me if you want but I'm going to do what I know is right and I will make a positive difference. I may be considered a n00b in Bitcoin-land, but I have a significant level of technical expertise, learn quickly and know what I need to do (already made some progress). I've also been scammed online in the past in non-Bitcoin transactions and managed to lead the authorities to the thieves, and have some other related experience. But most importantly, I will bring together other people who have a lot more skill and knowledge than I do and try to get some of the most brilliant minds in the Bitcoin world helping to fight fraud and protect honest people. A currency needs confidence or it's destined to fail, and we want Bitcoin to succeed and leave a positive impact on the world. But that can't happen until we start making Bitcoin unsafe for scammers, con artists and thieves. This isn't just about charge-back fraud or my negligible < $30 loss, it's about a great currency called Bitcoin and the good, honest people who use it.

We'll also be looking into things like the fraudulent "CPC Electronics" trying to sell fake mining equipment and any other type of fraud targeting the Bitcoin community. It's up to us to work together and protect each other and our entire "free market" currency system.

I'll post updates on our progress in this thread. As soon as we're able to launch a new website and forums and get the team organized I will provide links.

Thanks for your time,

--ATC--

P.S. -- Definitely going to get our company behind this and allocate some resources to the effort! And I hope other people will help the cause. If no one steps up to help I will be sad and disappointed but won't give up. Doing the right thing often means doing something very hard, and I'm prepared to accept the challenge... hope you are too, even if you can only do a little. Really hope we can bolster enough support to get an open, non-profit anti-fraud organization going sooner rather than later.