Topic: Bitcoin and Fraud - page 3. (Read 2993 times)

On the seller's side, since you are accepting bitcoins, generally you are safe in the deal if you require your customers to send first. If the customers sent it to the wrong address that is his fault and the seller does not have to send the product. If the seller sends a wrong address that is the sellers fault, and the seller must send the product as he was the one who had a mistake and the customer has already paid.

There are lots of scenarios where chargebacks should be applied but in this case if you want to make a platform like shopify or similar to it you have to send the payments after a month or like Google Adsense where the funds of this month sends at the end of next month, by this you can make the chargebacks and other things and not allowing the merchant to withdraw the profit. Check also Aliexpress they handle the disputes of their customers very well.

You are right it's rather better to be aware and smart rather than asking changes in the bitcoins while being stubborn of our own. If you don't trust a service provider and you yet want to try it, the best way is to use an escrow.
Yeah, one thing that I sincerely want is the development of an escrow site which is active 24/7

My question was about protecting the shopper, the merchant has nothing to worry about, he get his funds, no chargebacks or any lock on his wallet.

For those who answered with "use a credit card", well thank you genius, but the point here is using and promoting bitcoin while keeping both sides of the purchase satisfied.
For those who answered with "Do the same if you paid with another method", Paypal / CC / Wallets / Bank accounts have a solution to report fraud and get your funds back, not the case for Bitcoin.


Escrow is a good solution for digital products, but merchants will not get their funds fast, thus it is not convenient for the merchant to wait days till a shopper receive his order, and if he did, that shopper will probably not confirm.

Will see if somebody have something better to suggest

Well even reputed merchants can sometimes send wrong products and refuse to acknowledge it.
This has happened with me once.Although it didn't involve bitcoin but the merchant was reputed online e-commerce website.

What the Internet don't buy things for other currencies? Scammers do not pay attention to the currency. It does not matter what currency you have selected. On the Internet you need to buy only in the checked areas.

I guess we disagree here. Like i said we might see more scams now because Bitcoin is new. That is why people fall for "the double your money" scam and such. But i would argue that it is no because of the technical aspects. What do you have in mind? No charge backs? We don't have that with cash and they are not so common with bank accounts and credit cards. I don't expect significantly more scams with Bitcoin just because of its nature.

This is not quite accurate.  Bitcoin is particularly used for scams, in a way which transcends other currencies, because of its nature.  Bitcoin is designed in a way which facilitates scams.  Fortunately, anyone with a bit of scrutiny and intelligence can tell the difference between scams and legitimate businesses (or people) in about 95% of cases with some basic checks.

Fortunately the use of escrow is very convenient with Bitcoin as well with trusted members.  You can also feel secure because you only get scammed out of as much as you send to the seller, so in one way getting scammed with Bitcoin is better for the victim as they don't reveal their private information and are therefore not risking getting their accounts stolen.

I think that the most major companies are quite legitimate and people would assume that these services would scam them.  I don't know a lot of people that buy products from sites other than Amazon, eBay etc, and you know that if these sites starting accepting Bitcoin they wouldn't magically turn into scams.

As you can see now a many are fraudsters they want to get a easy money. The one thing you do don't trust anyone and  best thing is don't buy online using bitcoin.  You can cash out your bitcoin in real money then go to buy the things you want.

generally, the same thing apply to USD or EUR or any other payment option....
and the solutions could be applied to bitcoin too...

big websites generally offer service like escrow(in case of p2p) or you can buy from a trusted seller.

ps: your history illustrate the buyer side, not the merchant/seller.

It is pretty much possible to scam with every Payment method there is. Bitcoin is not different here, but since it is new people pay extra attention to scams and maybe scammers also test it so that there actually is a bit more scamming going on. However people are using all sorts of payment methods without being perfectly safe, because the wast majority is honest and it works most of the time. For big transactions you take extra measures to be safe.
Right now Bitcoin is developing more into the store of value direction rather then everyday cash, so we might see extensive use of escrow services. It wouldn't surprise me to see to see 2 or 3 big escrow companies in the future that get used for 90% of all transactions.
Escrows do cost more and take some time to, so i would expect that we just use Bitcoin normally and and accept the relatively rare scams as normal.
As a society we can do something against scams, but this is time and cost intensive. Especially to kill off the very last bit from under 1 % to 0 is very hard, time and cost intensive. The extra effort to do this is unproportional high, so we as society accept it. This btw is true for all crimes. 

Bitcoin as a currency? agreed.
Bitcoin as a store of value? agreed.
Bitcoin as a digital gold? agreed.
Bitcoin is exchangeable to fiat currency? yes.
Bitcoin is accepted in exchanging services worldwide? yes.
You should really use whatever is more convenient and easy for you which is to exchange bitcoin into fiat then use credit cards for your daily needs.
Even developers are trying to change bitcoin into a massively used worldwide cryptocurrency but with the current protocols it's impossible.
Once again if you feel you are losing money or not having the charge back advantage then turn your bitcoins into currencies where their processors accept and do chargebacks.

Escrow is the biggest thing that you can use to prevent things like this from happening, and especially when it comes to online commerce reputation can be (and is) very, very important. Bad reviews along with proof can mean a world of a difference.

Escrow may be another medium, but it does make a bit more money move within the Bitcoin economy, and that can be a good thing.

Think of Bitcoin as the anti-PayPal.

Paypal protects consumers at the expense of the seller. Businesses get screwed over buy PayPal all the time but it's great for the consumer. The upside is that average consumers are more likely to trust startups and sellers with no or limited history because PayPal will protect them if something goes wrong. It's good for new sellers too because they can get an easier start.

Bitcoin protects sellers at the expense of consumers. Consumers get screwed over buy Bitcoin businesses all the time (don't call me out and make me list businesses like Butterfuck labs to prove a point because I can list two pages of them) but it's great for the seller because they can't have a shady customer reverse their payment after they receive their product. The upside is startups and sellers with limited capital can avoid losing money to scamming consumers. It's bad for sellers though because consumers may be hesitant to trust or use businesses with limited history.

Holliday was right, everyone needs to use the system that works for them.

As for a consumer solution to the problems you list there are only a few. Escrow is one of them, using a business that's regulated by a responsive government is another but Russian consumer roulette is what most people have used historically. Sometimes you lose. Just don't spend much money at once using Bitcoin so you're not out much if you get screwed. Oh, don't think you're safe if you use a big company either. I have had an open investigation with Overstock.com for a long time about .95btc I sent them and never received the product.

You better use your credit card unless its a %1000 trusted seller which you haven't had any problems before. Using a decentralized currency has its advantages and disadvantages. Bitcoin is not your daily shopping currency.

When you have a problem with the seller, nobody's going to fix it for you if you used bitcoin.

In my view using trusted merchant and escrow is best if you have no these options then try to use some other method which can give you bring back payment option is more useful because if you are using bitcoin without escrow or trusted feedback then you can lost your hard earned money

Unfortunatelly scams are part of bitcoin since the beginning.
And the way bitcoin is designed, it makes it attractive to sellers.
Personally I don't use direct payment to a seller, only bitcoin payment service provider.
Sooner or later one of them will come up with some protection for the buyer, like paypal does it.

Some type of escrow or trusted 3rd party service to hold funds in trust until goods/services are confirmed delivered could be the best we can hope for.

Alternative methods to keep track of scammers other than IP tracking may also help.

Whatever scamming bitcoin is subject to has to be pale in comparison with the massive amount of credit card fraud in the world.

Unfortunately, this makes it difficult for new vendors, without an established position on the market, to start a Bitcoin business. They will need to offer something very attractive to a potential buyer to make him risk the money and buy it, or offer something cheap, so that people will ignore the possibility of being scammed and try it out.
Many scammers choose this strategy to start with a legitimate business that sells cheap products and then use their established position and well known brand to take advantage of their customers.

Do just the same thing you would do if you were to trade a real life object, say a smartphone, with another guy: never go first unless the trader is a very reputable guy. If it's an online website, the only option is signing an agreement upon signing up on the website where you would agree to the fact that it's mandatory to refund the money in case the order hasn't been delivered, the wrong product arrived or something else...