Gift Certificate issue

[CMD]

To make a long story short, back in January I sold a 3 Gift certificates on my site to the same buyer (first ones sold) totaling $1200. A day later those certificates were redeemed for a $1125 item. The item was shipped to a different address than the one used to purchase the gift certificate.

I just received a PayPal charge-back notice stating that the card owner never authorized it. Since it was a intangible item that I sold I believe I may be out quite a bit of money. Not to mention that I shipped the item purchased with the gift certificates to a different address than the one used to purchase the GC's.

I do have signature confirmation from the party that received the item bought by the gift certificate.

What I can't understand is, we know where the crook lives. Why can't something be done about it?

They were the only gift certificates I have ever sold in in almost 2 years. I am sure the norm is that they will be used by someone at a different address. I don't know how others do it, but I won't be selling any anymore.


Thanks

[cbsteven]

Sorry to hear about that.
I think the critical thing is that when the person originally paid for the GC's with a credit card, you need to somehow verify that the person making the purchase is the same person that owns that card. Honestly I'm not sure how to do this, this is an interesting situation and I've never sold electronic gift cards before. There has to be a process to make this resistant to fraud. Anyone have any ideas?

[Rungreen]

Call their local police department. Theft is theft. That alone might give them a nudge. This drives me nuts- how can the cops arrest someone for taking a candy bar from Walmart but not go after something like this?

Definately call the police. I like to Google Map the home and forward it to them, too!

[rrw]

I've tried that before--spoke to a couple of very nice detectives, but they don't pursue it. Problem is, even if it is delivered to the billing address, they can still claim that they did not order it and/or they did not take delivery of it. Basically, it's your word against theirs, and they will win.

[cbsteven]

Unfortunately it is not as simple as "theft as theft". The biggest problem is that usually there are two jurisdictions. One person commits a crime by using a stolen credit card number to make a purchase. The merchant then commits a "mistake" by shipping products to an address that is not the same as the billing address, which is the only way they are covered.

If you call the police in the area where the goods were shipped, they will probably say something along the lines of "you willingly shipped goods to this address knowing that it wasn't protected by the credit card company. You should call the bank that issued the card/or maybe the police where the cardholder lives."

I have tried dealing with the police a few times and although some of them have understood my situation and been sympathetic, I have never had anything beneficial come out of it.

The best thing to do is be vigilant and become good at detecting warning signs about when a transaction is likely to be fraudulent.

[rrw]

We had a chargeback once where the bill/ship address were the same, and there was a delivery signature, and we still lost. That's when I spoke to a detective in recipient's jurisdiction and was told, "sorry".

[cbsteven]

That's weird. No way you should have lost that chargeback. And it certainly wouldn't be anything the police would handle. Maybe a lawyer.

[rrw]

When it's only an $80 sale it isn't worth the legal fees, unfortunately. I just wish them "all the bad luck in the world" and move on.

[SarahInc]

It seems as a business owner that there are a lot of rules/laws in effect that protect the buyer, but not the seller. But in the same respect, as a buyer, I have felt that I have been protected either when it comes to Internet sales. It seems this is an area both for the business and consumer that still needs some work.

And I just have to say that I have a wedding/gift business so OFTEN the billing address and ship to address are not the same. If I didn't allow this, I would lose sales. It's a battle.