Credit card firms profit from Net fraud
The source: http://www.theregister.co.uk/content/67/30849.html
Think credit card companies have an incentive to crack down on credit fraud think again. If you ask me its time to replace credit cards with something a little more secure.
Quote:
Credit card firms 'profit from Net fraud'
By John Leyden
Posted: 23/05/2003 at 13:04 GMT
A class action lawsuit against credit card firms alleging merchants are unfairly left to shoulder the burden of credit card fraud has begun in the US.
The suit, filed by North Carolina-based law firm Triangle Law Center, in the US States District Court for the Eastern District of North Carolina, alleges all manner of misdeeds on the part of credit card companies. Visa, MasterCard International, American Express and Discover Financial Services are all named in the suit, which certainly doesn't pull its punches.
The complaint charges that "Visa, MasterCard and their co-conspirators (i.e., their issuing and acquiring banks) violated Section 1962(c) and 1962(d) of the Racketeering Influence and Corrupt Organizations Act, Section 16 of the Clayton Act, Section 2(a) of the Robinson-Patman Act".
Credit card firms and banks engaged in "unlawful business practice violations by conspiring to commit fraud and theft through means of wire and mail when processing merchants' Internet, telephone and mail order transactions," it is alleged.
According to the suit, the "Defendants breached their contract, their implied covenant of good faith and fair dealing, duty of care and fiduciary duty as a banking institution by failing to take appropriate measures in addressing fraud and theft in the Internet, telephone and mail order industry".
The complaint further alleges that Visa and MasterCard failed to disclose certain transactional and penalty fees to merchants and forced retailers to pay such these fees using an "abuse of their monopolistic powers".
Furthermore, the complaint alleges that in "cyber-shoplifting" scenarios, there "are virtually no set of facts or documentation in which an Internet, telephone and mail order merchant could argue to prevent defendants from debiting penalty fees from their merchant accounts".
As a result of these "unlawful acts", according to the complaint, merchants have been forced the bear the burden of credit card fraud while credit cards firms and banks made millions of dollars from their transactional and penalty fees.
The Honorable Terrence W. Boyle has been appointed as judge in the case (number 5:03-CV-372-BO(3)).
Lawyers in the case are inviting merchants to join the class action lawsuit online or by contacting attorney Mark W. Ishman, of Ishman Law, directly. His number is +1 919 942-1410. ®
