[David Aldrich]

  That does not make sense.
 
Suppose my credit card number is stolen by "A. Romanian Scammer".  A. Romanian Scammer submits an order to Schiit and has you deliver it to Bucharest instead of my billing address in California.
 
When I find out my card is stolen, I report it to my bank.  Of course, Visa Processor is going to return the money to my card.  But if I report the transacation as not being done by me, why would they charge the merchant ??

Banks don't like taking hits, if they pay you back and pay the merchant they're out the cash but their customer is happy, if they pay you back and don't pay the merchant they lose nothing and have kept their customer happy. For credit processors keeping the consumer happy is more important than keeping a business happy since only the former has such a broad choice when picking a bank to use. Businesses can't just bounce between banks for credit processing as easily as a customer can, in that way banks can get away with a lot more.

 

[rmullins08]

   
The only protection we have is to require questionable orders to pay via a Paypal verified transaction.  That puts Paypal on the hook if there is a problem.  I have only had one Paypal verified transaction contested as fraudulent.  I won that claim. 

 
Hadn't even realized that I usually use paypal on your site just out of laziness and not wanting to get my wallet.  Glad it safer for you guys.

 

[kstuart]

 

  That does not make sense.
 
Suppose my credit card number is stolen by "A. Romanian Scammer".  A. Romanian Scammer submits an order to Schiit and has you deliver it to Bucharest instead of my billing address in California.
 
When I find out my card is stolen, I report it to my bank.  Of course, Visa Processor is going to return the money to my card.  But if I report the transacation as not being done by me, why would they charge the merchant ??

Banks don't like taking hits, if they pay you back and pay the merchant they're out the cash but their customer is happy, if they pay you back and don't pay the merchant they lose nothing and have kept their customer happy. For credit processors keeping the consumer happy is more important than keeping a business happy since only the former has such a broad choice when picking a bank to use. Businesses can't just bounce between banks for credit processing as easily as a customer can, in that way banks can get away with a lot more.

I certainly understand that the best thing for the bottom line is to pay nothing and collect everything.
 
However, there would seem to be the additional factoid that the card number is stolen.
 
In my earlier example, when the Schiit gear is delivered to Bucharest, and then later I see the charge on my card that I did not make, I contest the charge and then as Alex says, the Visa Processor then "rules in favor of the customer" rather than "declares that the card is stolen".
 
At that point.... Schiit has all of my contact information.  Can't they get their money back simply by contacting me and asking "Why did you contest the charge of the Schiit gear that you had us ship to Bucharest?".
 
I then reply " I never ordered any Schiit gear, my card was stolen. " and Schiit can then request their money from the Visa Processor on the grounds of "card stolen".

 

[rovopio]

 
I certainly understand that the best thing for the bottom line is to pay nothing and collect everything.
 
However, there would seem to be the additional factoid that the card number is stolen.
 
In my earlier example, when the Schiit gear is delivered to Bucharest, and then later I see the charge on my card that I did not make, I contest the charge and then as Alex says, the Visa Processor then "rules in favor of the customer" rather than "declares that the card is stolen".
 
At that point.... Schiit has all of my contact information.  Can't they get their money back simply by contacting me and asking "Why did you contest the charge of the Schiit gear that you had us ship to Bucharest?".
 
I then reply " I never ordered any Schiit gear, my card was stolen. " and Schiit can then request their money from the Visa Processor on the grounds of "card stolen".

 
the company might not care.
i.e. haiku

 

[David Aldrich]

   and Schiit can then request their money from the Visa Processor on the grounds of "card stolen".

 
They can get away with saying you're Schiit out of luck. Those banks have lawyers draw up airtight contracts that are just about unavoidable in consenting to if you want to be able to accept credit card transactions.

 

[kstuart]

So, the contracts say:
 
" If someone steals a credit card and charges your merchandise to the card, then Ha Ha, you are out of luck, sucker ! "
 
??
 
That seems a little extreme even for Moscow...

 

[David Aldrich]

They'll have a very obscure yet eloquent way of phrasing that.

 

[rschoi75]

As a small business owner in sporting goods, I could not agree more. It takes humoungous balls to write this and post it up in your marketplace. Bravo.

 

[tonykaz]

Mr.Stoddard,
I'm glad to know you have an Eagle-eye out for these cheats and that you're getting good at spotting them.
 
We, as a Society, are seeing quite a bit of this kind of thing lately.  Our Tyll just got hit in Vegas, Lance Armstrong got caught cheating, Koss (the headphone outfit) is trying to cope with a multi-million dollar "Inside" fraud, Bernie Madoff pulled off a Billion Dollar scam, the Financial people drove the Global Economy into a decade long depression, there doesn't seem to be an end to this sort of thing.
 
However,
 
Everyone reports the founders of Schiit to be "Men of Integrity", I always felt that you have acted responsibily in all things.  
 
I personally thank you for continuing, I am always happy to recommend you and your products, I've never heard of anyone thinking of you in any other than the brightest of ways.  
 
I wish you every success,
 
Tony in Michigan
 
ps, the little power switch location debate is just a silliness discourse and distraction, I'll keep your stuff in mind.  I love my Asgard 2!!!

 

[Jason Stoddard]

  Can't they get their money back simply by contacting me and asking "Why did you contest the charge of the Schiit gear that you had us ship to Bucharest?".
 
I then reply " I never ordered any Schiit gear, my card was stolen. " and Schiit can then request their money from the Visa Processor on the grounds of "card stolen".

 
This is always done. The credit card company, and therefore, the processor, always decides against us. That's what Alex has been saying.
 
To amplify, this is from Authorize.net, a major payment gateway:
 
When a brick and mortar merchant accepts a credit card, and the charge is authorized, and assuming the merchant conforms to regulation, the merchant will get paid, even if a stolen card is used. Liability for fraud shifts from the card issuer to the merchant for 'Card Not Present' sale (mail order, telephone/fax order, and internet sales). The merchant is generally liable for credit card charge backs, even when the bank has authorized the transaction. 
 
https://support.authorize.net/authkb/index?page=content&id=A676

 

[hifi nub]

@thisbook.
 
Scammers:
 
The title on head-fi.org grabbed my attention.
 
How much does it take to make a unit and send it off in total?
 
How much does it take to make a unit, make profit off it and send it off? Profit in total?
 
How many little company's like yours turned out to be scams? "butterflylabs run in your mind?" Google butterflylabs and law suits. This is where I am Leary and took a chance on schiit.
 
Time Warner or not, we all "wait, time warner?" have been scammed from the net one time or another.
 
Have you guys heard of bitcoin before? " https://bitcoin.org/en/ " I have myself been scammed 14 grand in total in todays price. Scams go on like madness hardcore over @bitcointalk.org and other places as well.
 
Take it like a champ all I can say and I am not a notorious person or anything, not just me anyhow. Many many ppl have been scammed hardcore more than anyone could ever imagine "us govt ring a bell? Solar panels, War, Drugs, and the grand surprise is, you guessed it! Military and banking!".
 
I am a schiit lyr2 owner. I am happy to put american jobs on the table, hey one unit does help.
 
Not only this, this puts jobs on tables for audio device company's and standalone ppl like rb2013 and booms the music industries. All because of one little company like schiit drives the economy.
 
I'll stop here and add to it later!
 
Hope you enjoyed reading, I sure did.

 

[kstuart]

Originally Posted by Jason Stoddard /img/forum/go_quote.gif
 
Liability for fraud shifts from the card issuer to the merchant for 'Card Not Present' sale (mail order, telephone/fax order, and internet sales). The merchant is generally liable for credit card charge backs, even when the bank has authorized the transaction. 
 
https://support.authorize.net/authkb/index?page=content&id=A676

 
Wow, that is a great example of " something too big and important to ever get on the News ".

 

[Ableza]

This is why I pay using PayPal.

 

[rmullins08]

  This is why I pay using PayPal.

PayPal isn't without it's flaws though.  I ordered a pair of boots on Black Friday 2013.  They weren't in stock at the time, but deducted the money.  After an update two weeks later they apologized for the delay and that they would be able to ship by mid-january.  I wasn't paying attention and by the end of January when there were no updates.  I sent e-mails and left voicemails with no response.  By the time I tried to file a dispute with paypal, they denied my dispute as they must be made within 45 days of the transaction.  Never received the boots, and it looks like they shut down their website a few weeks back.

 

[Alex Martin]

   
Wow, that is a great example of " something too big and important to ever get on the News ".

Over the last three years I have done some soul searching on this one and the reality is the merchant should be held responsible for the bogus charge.  Under the law, the cardholder is not responsible- and after all the problems with Target, Home Depot, Staples, etc.- the card owner really can't be blamed if their card information is stolen.  How about the card issuer?  They have no control over how the card is used.  All they can do is put in algorithms that catch some kinds, but not all kinds, of fraud.  The processor is in the same boat as the bank.  If you make the bank or processor responsible for the fraud, they will tighten up transactions and increase fees to all customers to cover the costs. 
 
The only person who has the information and the ability to act on it is the merchant.
 
In brick and mortar stores, the clerks should be checking identification and examining the card.  Many stores in the US you just swipe and sign.  Europe uses chip and pin.  They don't have as big of a credit card problem.  We don't have chip and pin in the US because the credit card companies and the big merchants decided it would be too expensive. 
 
Online, I have the customers information in front of me.  With a name, address, phone number, and email address I can find out a lot about a person.  If the order doesn't look right, then it is my responsibility to verify the order.  If I can't verify it or it looks fishy I should cancel the order.  The merchant is the only entity in this entire chain of responsibility who has this opportunity.  As Jason said, you can either raise prices or do the hard work of inspecting each order.  We'll spend our time inspecting.
 
It doesn't mean we won't get angry every time that we get taken.  That is a good thing.  It teaches us to try harder.