

CC/iTunes Hackers Laundering Money? - alexlin
http://www.pocketgamer.biz/r/PG%2EBiz/iTunes/news.asp?c=37761

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ChuckMcM
Title is wrong, this isn't 'laundering' its just fraud.

So the TL;DR version - App has a way to purchase virtual goods, app vendor
'sells' such goods but money from Apple at the end of the day doesn't add up
to the number of goods they sold. Reason is that some of the 'sales' are
contested by users which then result in charge backs and Apple returns the
cash and deducts that out of what they send to the developer.

This sort of stuff will eventually kill 'in-app' purchases. The fraud rate is
too high, the money too lucrative (which keeps the fraud rate high), the laws
protect the consumer (that is good btw).

So the developer is left 'holding the liability' which is to say their virtual
goods are 'stolen' and they don't get paid what they expect. Apple doesn't
lose, the Credit Card companies don't lose, only the developer does.

So if you are looking for a startup idea, figure out a way to provide a remote
'kill switch' on virtual goods. Which is to say, from the developer's
perspective if the purchase doesn't completely go through and stay valid, the
item vanishes. That will kill the black market for such goods and return the
problem to direct fraud vs the indirect fraud which makes it hard to fix.

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compsciphd
[http://www.ebay.com/sch/i.html?_from=R40&_nkw=amazon+gif...](http://www.ebay.com/sch/i.html?_from=R40&_nkw=amazon+gift+card&_sacat=See-
All-Categories)

notice something?

Amazon gift cards go for more the face value. (This is the common situation on
ebay).

2 possible answers

1) People are idiots (not discounting, this) 2) Credit Card fraud.

(possibly others)

