Sophia RosenbaumTHE ASSOCIATED PRESS – NEW YORK
My desperation to see Ariana Grande in concert createdthe perfect trap.
Instead of seeing her sing about love and loss, I got sucked intoan online ticket scheme that cost me $75 and a big chunk of mypride.
Con artists often get away with scams like these because digitalpayment services such as Venmo and Apple Cash don’t protectconsumers the same way credit cards do. As a rule of thumb, thenewer the service, the more likely con artists will target it.
“The regulations haven’t caught up with these technologycapabilities,” said Krista Tedder, head of fraud management at theadvisory firm Javelin Strategy & Research.
With credit cards, federal law caps your liability at $50, andmost companies go further with zero-liability policies. Debit cardstypically offer similar protections if you report the fraudimmediately. In addition, banks go through a series of verificationsbefore letting someone open an account.
But digital payment services work more like cash. When fraudoccurs, it’s as though someone took off with your $20 bill.
Because such services aren’t bound by the same regulations ascredit and debit cards, it’s up to individual companies to offerprotections themselves.
Experts say Western Union, which has been offering moneytransfers long before smartphones, devotes a team to monitoring andvalidating transactions. Tedder said Western Union would even call acustomer if something looks suspicious.
“They really treat every transaction as a potential risk,”Tedder said.
A more recent service, PayPal, offers reimbursements whenmerchants ship damaged or counterfeit items, but digital moneytransfers aren’t covered.
The newest ones, including Apple Cash, are still figuring out howto deal with fraud, experts say. Others, like Facebook’s proposedLibra currency, is on the horizon.
“These payment systems should carry a big red flag that saysyou’re not protected,” said Avivah Litan, a senior analyst atGartner. “I never use them because I know of all the perils.”
Western Union and PayPal, which also owns Venmo, declined commenton their fraud-protection policies.
Apple also declined to comment, but offers online tips that warn,“If you’re not sure about their identity, don’t send the payment.”
To be fair, my phone warned me to use Apple Cash only with peopleI knew, but I ignored that in my desperation to get the tickets. Iwrongly assumed that because Apple Cash was drawing money from mydebit card account, I’d be protected if anything went wrong.
As I looked for tickets online for Grande’s sold-out show inSeptember, some of the people I spoke to clearly were scammers: Theywouldn’t send pictures of their tickets. Their social media accountseemed too new to be real.
But one person had a plausible story about just wanting to getsome money back for a show he couldn’t attend. We talked twicethrough a Facebook Messenger call, which I found comforting, thoughmy partner later pointed out it was a false sense of security.
The biggest red flag I ignored was the scammer’s insistence onusing Apple Cash, a payment method I was unfamiliar with. Launchedin 2017, Apple Cash lets iPhone users send money to each otherthrough Apple’s Messages app. Money you send comes out of your bankaccount. Money you get can be spent at merchants that take Apple Payor moved back to a bank account.
Five minutes after I sent $75 through Apple Cash, the scammer’sFacebook account disappeared, and so did all my ways of contactinghim.
Since then, I’ve felt guilty and embarrassed that I fell for it,angry that companies aren’t protecting me and sad that I didn’t getto go to the concert.
“A lot of people have this happen to them and blame themselves,and it’s not their fault,” Tedder said.
It’s not clear how widespread these scams are. The Department ofJustice found only 15% of all fraud victims report it to lawenforcement. The FBI says while it’s unclear why so few peoplereport fraud, many of the complaints they do receive show victimswere embarrassed or worried their family would be devastated.
Tedder said that if more people reported these scams, it couldbetter inform government agencies tasked with tracking and in turn,creating solutions and policies for these types of crimes.
Experts also say consumers are typically unaware of what is andisn’t protected. Litan said she believes the government should domore to educate people.
There are some hopeful developments. Apple has partnered withGoldman Sachs for an Apple-branded credit card, which some expertssay may put pressure on Apple to get more serious about protectingits consumers on other services like Apple Cash.
But even newer services _ and newer targets for scammers _ arecoming. Facebook is working on a digital currency called Libra,which the company says will allow for easier buying and sellingacross the internet. Facebook says when people spend libras throughFacebook’s own wallet, Calibra, their identities will be verified tohelp guard against fraud. But well before the currency’s launch,scammers are already trying to sell fake libras.
In the words of Ariana Grande, I have “learned from the pain.”Fortunately, I’ll be able to see her sing that very line next weekin New York, as she added more concert dates after I was scammed. Ibought two tickets through Ticketmaster. Though fees get expensive,I now realize I’m praying for the peace of mind.