Black teenager arrested after buying expensive belt

[EVT1]

Since when does a store have to eat losses for credit card fraud?  Kind of ruins your little theory doesn't it?  All the store has to do is verify the ID and run the card- if it works move on to the next customer.  Sheesh how hard is it?  Besides- this was a debit card transaction with a PIN.  It is not the job of the store to investigate their customers- gee, that guy looks a little ratty for our usual customer, so go ahead and sell him these expensive items, take their money, and then sick the cops on him.  Eff that- good luck with the lawsuit.

Where were you going to end up?  Ban black customers, hypothetically?  Get real.

[moon/Laura]

Oct 27, 2013 16:58:56 GMT -5 Virgil Showlion said:

At what point should they acknowledge that serving a particular demographic is too great a risk to be profitable?

if a retailer feels like discrimination is the answer to their shrinkage problem, then maybe they need to not be in business at all.

Oct 27, 2013 16:58:56 GMT -5 Virgil Showlion said:

So what would you do? Hypothetically?

NON HYPOTHETICALLY, i wouldn't act like a racist asshat, like the cashier at barney's did. The customer provided the ID he was asked for. that should have been the end of it.

[Virgil Showlion]

Sheesh how hard is it?

If the store has to issue numerous appeals and hassle the banks and CC companies to recoup the funds, it's slightly hard.

If the manager gets tossed out his/her butt for letting through a large number of fraudulent claims that must then be recouped, it's extremely hard.

Ban black customers, hypothetically?

"Black customers" is far too general, unless you consider 30% of blacks being fraudsters being a reasonable hypothetical.

My hypothetical is that you've identified a demographic specific enough that 30% of transactions with this group consistently turn out to be fraudulent. Maybe it's black teenagers wearing "NYC" baseball caps. It doesn't matter. The only facts of importance is that you've established a profile, and serving people that fit the profile is guaranteed to waste your time and money on average. Or if you prefer, serving this demographic is guaranteed to create headaches for your boss that could very well lose you your job.

How do you deal with it? Either case?

[Virgil Showlion]

Oct 27, 2013 20:49:53 GMT -5 moon/Laura said:

Oct 27, 2013 16:58:56 GMT -5 Virgil Showlion said:

At what point should they acknowledge that serving a particular demographic is too great a risk to be profitable?

if a retailer feels like discrimination is the answer to their shrinkage problem, then maybe they need to not be in business at all.

Well I guess you'll have to excuse them when they decide to stay in business, ignore your suggestion, and do whatever they feel is in the interest in the profitability of their business.

[Tennesseer]

Oct 27, 2013 20:50:53 GMT -5 Virgil Showlion said:

Sheesh how hard is it?

If the store has to issue numerous appeals and hassle the banks and CC companies to recoup the funds, it's slightly hard.

If the manager gets tossed out his/her butt for letting through a large number of fraudulent claims that must then be recouped, it's extremely hard.

Ban black customers, hypothetically?

"Black customers" is far too general, unless you consider 30% of blacks being fraudsters being a reasonable hypothetical.

My hypothetical is that you've identified a demographic specific enough that 30% of transactions with this group consistently turn out to be fraudulent. Maybe it's black teenagers wearing "NYC" baseball caps. It doesn't matter. The only facts of importance is that you've established a profile, and serving people that fit the profile is guaranteed to waste your time and money on average. Or if you prefer, serving this demographic is guaranteed to create headaches for your boss that could very well lose you your job.

How do you deal with it? Either case?

Bottom line Virgil-what would you do.

[moon/Laura]

I think that if a store actually used discrimination in the manner you're suggesting virgil, they would no longer HAVE a business anyway because no one I know would shop somewhere like that. the sheer volume of negative publicity they'd receive would kill it dead in no time flat. and rightfully so.

[Tennesseer]

Oct 27, 2013 21:00:19 GMT -5 moon/Laura said:

They would be out of business within a month's time if they discriminated.  

[resolution]

Oct 27, 2013 16:58:56 GMT -5 Virgil Showlion said:

What if they suspected him because 30% of the black teenagers who walk, talk, and dress like him that walk through the door are running credit card scams?

What if it's 40%? 60%?

At what point should they acknowledge that serving a particular demographic is too great a risk to be profitable?

Let's consider the problem from that standpoint. Suppose you are a Macy's storeowner. You have a standard markup on your merchandise--your standard retail margin. And suppose out of all the black teenagers that look and talk a certain way, you've determined that roughly 30% of them that come into your store are running credit card scams. The credit card company won't reimburse you for your losses, and a simple bit of math shows you that a 100% loss on 30% of this demographic more than annihilates your profits from the legitimate 70%. In short, by serving this demographic no-questions-asked, you are guaranteed to lose money.

You have several options:

- You can upgrade your credit card security so that you only accept electronically validatable cards with PINs. This will understandably upset and alienate your customer base that doesn't have this kind of credit card.

- You can eat the losses or raise prices on all your goods in an attempt to recoup your losses, hoping that you don't price yourself out of the market.

- You can pay out a large monthly sum to the various credit card companies to insure yourself against perpetual fraud.

Or

- You can give every black teenager using a credit card a hard time, even refuse them service and involve the police, to mitigate your losses at the expense of the 70% "good" portion of this particular demographic.

So what do you do? Rest on your principles? Or run a profitable business? And don't say "Oh, the problem isn't that bad," because I'd bet you dollars to doughnuts that if we went in and talked to these "hoity toity" store managers, some of them which may well be black themselves, they'd report numbers like 30%+ fraud for groups as specific as black teenagers that look and dress like such. The groups they single out might be even more specific than this. People are perceptive. And it's extraordinarily easy for us to sit a mile a way and shrug, "Oh, yeah, I guess you're losing fistfuls of money on that demographic, but at least you're not being hoity toity."

So what would you do? Hypothetically?

The lawsuits with large settlements are the deterrent that prevent many companies from going with the illegal option.

[moon/Laura]

Not sure which post of mine you're quoting, Tennesseer but I agree with you!

[Tennesseer]

Oct 27, 2013 21:08:33 GMT -5 moon/Laura said:

Not sure which post of mine you're quoting, Tennesseer but I agree with you!

Reply #35 moon.

ETA:  actually all your posts here.

[Virgil Showlion]

Oct 27, 2013 20:58:09 GMT -5 Tennesseer said:

Oct 27, 2013 20:50:53 GMT -5 Virgil Showlion said:

If the store has to issue numerous appeals and hassle the banks and CC companies to recoup the funds, it's slightly hard.

If the manager gets tossed out his/her butt for letting through a large number of fraudulent claims that must then be recouped, it's extremely hard.

"Black customers" is far too general, unless you consider 30% of blacks being fraudsters being a reasonable hypothetical.

My hypothetical is that you've identified a demographic specific enough that 30% of transactions with this group consistently turn out to be fraudulent. Maybe it's black teenagers wearing "NYC" baseball caps. It doesn't matter. The only facts of importance is that you've established a profile, and serving people that fit the profile is guaranteed to waste your time and money on average. Or if you prefer, serving this demographic is guaranteed to create headaches for your boss that could very well lose you your job.

How do you deal with it? Either case?

Bottom line Virgil-what would you do.

Require PIN-protected chip cards that could verify availability of funds in real time. Call the police if I reasonably suspected I was handling a stolen card.

And for the record, I wouldn't suspect anybody using a PIN-protected debit card for a $350.00 purchase had stolen the card unless they appeared homeless and destitute. If I called the police, I wouldn't expect the "racist" hammer of death to come down on me because I'd reported my suspicions.

The lawsuits with large settlements are the deterrent that prevent many companies from going with the illegal option.

If the lawsuit targets the company rather than the public, it's a deterrent. If a company persists in doing it quietly, it means that discriminatory policies save them more money than they lose by settling lawsuits.

[Tennesseer]

Virgil Showlion - I assume you would require a PIN protected chip card of all your customers. Or cash.

[Virgil Showlion]

Oct 27, 2013 21:49:51 GMT -5 Tennesseer said:

Virgil Showlion - I assume you would require a PIN protected chip card of all your customers. Or cash.

Absolutely.

Profiling would be an act of desperation. I'd only resort to it if I couldn't prevent fraud any other way. But note that if there was no other way, I would resort to it. I've said in other threads and I'll say it here: I certainly do not consider the right to be served by a business to be a fundamental right. I don't even consider it a good or reasonable right to enforce. Denial of service to any person by any private company on any basis would be completely legal in a Virgil-run world.

[EVT1]

Why argue over a false premise?  Virgil has created a situation that does not exist in order to somehow condone these actions it appears.

There is no pursuing and appealing the banks or credit card companies- at least not in this country.  If a customer uses a credit card or debit card and they check the ID that's the end of it.  The CC company or bank eats the fraud if there is any.  If there is any doubt with the ID they can simply refuse the transaction- you don't proceed with a questionable sale and call the cops- that's just freaking ridiculous.  Pay up fellas- what you did was wrong and quit doing it. 

[Virgil Showlion]

Oct 27, 2013 22:13:42 GMT -5 EVT1 said:

Why argue over a false premise?  Virgil has created a situation that does not exist in order to somehow condone these actions it appears.

There is no pursuing and appealing the banks or credit card companies- at least not in this country.  If a customer uses a credit card or debit card and they check the ID that's the end of it.  The CC company or bank eats the fraud if there is any.  If there is any doubt with the ID they can simply refuse the transaction- you don't proceed with a questionable sale and call the cops- that's just freaking ridiculous.  Pay up fellas- what you did was wrong and quit doing it. 

The city is the one being sued.

And even if Macy's is the one who ends up paying for it, how are they responsible? For hiring an employee who reported a suspect purchase to police?

From the Financial Post:

Retailers are supposed to follow card-handling procedures such as verifying the signatures. But since they have no liability on a fraudulent credit card transaction, there is no incentive for a retailer to raise a red flag.

“There is a responsibility for retailers to train their staff to notice certain people who don’t seem to fit the norm,” says Mark Beazley, director of communications with the Retail Council of Canada. And retailers do get a $50 reward for recovering a stolen card. He says retailers don’t like fraudulent sales, even if they’re paid for by the credit card companies because it can have a major impact on business over the long term.

So damned if you do, damned if you don't.

But I guess everything's just peachy if the banks and credit card companies have to eat it.

[Deleted]

But I guess everything's just peachy if the banks and credit card companies have to eat it.

 They seem to have few qualms about eating consumers alive, using various fees and service charges, and charging usurious interest rates. 
 Sorry, Virg... I have little sympathy for banks and CC companies... and no patience for anyone who tries to make the bloodsuckers out to be innocent victims. 

[EVT1]

Well I don't know about Canada but here we quit using those bulky sliding things for credit cards a while back and they can actually verify cards and balances, whether card are stolen- it's real high tech you should look into it. 

Pretty much when a valid ID matches the name on a valid card you should probably leave that person alone- especially one that used a PIN.

And if you are police- you should probably accept the receipt, ID and valid card and realize you have no probable cause to arrest someone.  Are you telling me the police don't know how to tell a fake ID?  They are hosed on this.

Sure it will be settled quietly but it would be nice to see these people dragged into court and find out exactly what happened and who lied- the store say's they didn't call, the cops say they did, and I would love to hear the explanation for an arrest.

[EVT1]

Wonder how many teenagers Best Buy is going to have cops chase down after buying the $400 phones, game systems, and the like these next few months.  Will the police be chasing kids down asking how they can afford a Play Station?

[Virgil Showlion]

Well I don't know about Canada but here we quit using those bulky sliding things for credit cards a while back and they can actually verify cards and balances, whether card are stolen- it's real high tech you should look into it.

If you read the article, you'd see your super-high-tech PIN-protected chip card can still be ripped off with ease. If I had no moral qualms and a serious need for money, I could do it with maybe $200 worth of circuitry and a smart phone, for Pete's sake.

Oct 27, 2013 22:41:49 GMT -5 EVT1 said:

Well I don't know about Canada but here we quit using those bulky sliding things for credit cards a while back and they can actually verify cards and balances, whether card are stolen- it's real high tech you should look into it. 

Pretty much when a valid ID matches the name on a valid card you should probably leave that person alone- especially one that used a PIN.

And if you are police- you should probably accept the receipt, ID and valid card and realize you have no probable cause to arrest someone.  Are you telling me the police don't know how to tell a fake ID?  They are hosed on this.

Sure it will be settled quietly but it would be nice to see these people dragged into court and find out exactly what happened and who lied- the store say's they didn't call, the cops say they did, and I would love to hear the explanation for an arrest.

I don't think the arrest was right, but I maintain that the lawsuit fixes nothing.

[EVT1]

We have a Macy's/NYPD problem obviously:

www.nbcnewyork.com/news/national-international/Macys-Racial-Profiling-Claim-Denied-Robert-Brown-229463421.html

     Macy's released a statement in response to a lawsuit from an actor on HBO's "Treme" who said he was stopped while buying sunglasses in the store because he is black denying that the department store's employees detained the man.

     A lawsuit filed by Robert Brown in state Supreme Court in Manhattan Friday alleges the actor was stopped by police at the 34th Street location after employees there contacted authorities about possible credit card fraud. He says he was held at the store, handcuffed and searched before being released.

     In the statement released Sunday, Macy's said that according to an initial investigation, its "personnel were not involved in Mr. Brown's detention or questioning," which was "an operation of the New York City Police Department."

Funny- that's exactly what they said about the other guy.  They need to get to the bottom of this- why is the NYPD hanging out on private property handcuffing people if there are no allegations by the store- notice they said they were not involved in detention or questioning- not that they didn't call........smart- police departments record calls.....sure a lawyer is working on getting those right now.  Wouldn't put it past the NYPD to expand their bullshit (and Unconstitutional) stop and frisk policy to shoppers that meet certain 'criteria'.....

[EVT1]

Oct 27, 2013 22:53:18 GMT -5 Virgil Showlion said:

Well I don't know about Canada but here we quit using those bulky sliding things for credit cards a while back and they can actually verify cards and balances, whether card are stolen- it's real high tech you should look into it.

If you read the article, you'd see your super-high-tech PIN-protected chip card can still be ripped off with ease. If I had no moral qualms and a serious need for money, I could do it with maybe $200 worth of circuitry and a smart phone, for Pete's sake.

Oct 27, 2013 22:41:49 GMT -5 EVT1 said:

So it seems the CC companies should spend some of their billions they make ripping off people into making cards that are not so easy to spoof- you think we should take it out on suspicious customers because the security measures are weak and some people are thieves?

[EVT1]

Can you imagine the outrage if this happened to some white kid a block a way from the gun shop after purchasing a new pistol?  We would be in Nazi Germany by lunchtime  

[Virgil Showlion]

Oct 27, 2013 23:17:38 GMT -5 EVT1 said:

Can you imagine the outrage if this happened to some white kid a block a way from the gun shop after purchasing a new pistol?  We would be in Nazi Germany by lunchtime  

Fine. And if he sued the police for half the GNP of Portugal in recompense for his "great humiliation" or whatever crap his lawyers came up with, you'd be the first one in here demanding "What the what?"

[mmhmm]

There are other options, Virgil.  Banks can make ALL credit cards electronically validatable.  This could be mandated.  A great deal of retail theft is perpetrated by employees of the establishment.  Shall we, then, frisk every employee at the end of his/her shift to see they're not carrying away something for which they haven't paid?  Shall we audit their cash registers, one by one, before they can leave work to go home?  Or, should we only do this to employees who are dark-skinned?  Maybe only to male employees, or female employees?

[Value Buy]

Oct 27, 2013 21:00:19 GMT -5 moon/Laura said:

I think that if a store actually used discrimination in the manner you're suggesting virgil, they would no longer HAVE a business anyway because no one I know would shop somewhere like that. the sheer volume of negative publicity they'd receive would kill it dead in no time flat. and rightfully so.

Not necessarily true.
Some people just have to have the $2,300 handbag regardless of cost.
Racism never would have stopped a customer on a mission.
White or black.
(some people are immune to the politically correct concept of personally fighting politics, religion,  and racism if it stops them from doing what they want to.)

[Virgil Showlion]

Oct 28, 2013 5:53:44 GMT -5 mmhmm said:

There are other options, Virgil.  Banks can make ALL credit cards electronically validatable.  This could be mandated.  A great deal of retail theft is perpetrated by employees of the establishment.  Shall we, then, frisk every employee at the end of his/her shift to see they're not carrying away something for which they haven't paid?  Shall we audit their cash registers, one by one, before they can leave work to go home?  Or, should we only do this to employees who are dark-skinned?  Maybe only to male employees, or female employees?

Retailers are slowly, surely moving to PIN-protected cards that can be validated in real time. It still doesn't protect against compromised card readers, card skimmers, etc.

There will always be fraud. The ideal is to reduce it to the extent that you don't need to profile in order to make your business profitable.

As for auditing cash registers, frisking employees, etc.: if a business is losing money and the owner suspects that employees are taking from the till, then absolutely. If a manager has heard a rumour that three of his five male employees have a small conspiracy running to skim profits, I see nothing wrong with him installing cameras or special software to monitor the transactions handled by all of his male employees and omitting the female ones. You direct your efforts into solving a problem in the most efficient manner possible.

[mmhmm]

Yes, there will always be fraud.  That is not an excuse for arresting people who have done nothing to warrant arrest.  There was no reason to suspect this young man of fraud/theft; therefore, it's unlike an employee who has done something to place him under suspicion, is it?  No, it isn't.  The "most efficient manner" isn't arresting everybody and anybody who uses a credit card while the "wrong" color, Virgil.

[Virgil Showlion]

Oct 28, 2013 9:27:44 GMT -5 mmhmm said:

Yes, there will always be fraud.  That is not an excuse for arresting people who have done nothing to warrant arrest.  There was no reason to suspect this young man of fraud/theft; therefore, it's unlike an employee who has done something to place him under suspicion, is it?  No, it isn't.  The "most efficient manner" isn't arresting everybody and anybody who uses a credit card while the "wrong" color, Virgil.

I don't agree with the arrest.

I do believe merchants should be able to openly refuse service to any customer on any basis, including age, gender, religion, ethnicity, and any other imaginable trait.

As it stands, merchants simply do it quietly and indirectly. Hence not only do you have the discrimination, you have a mess involving lawyers, police, lawsuits, and both pro- and anti-racial activism flying every which way. Money changes hands, but nobody's opinions are changed. Nobody respects the counterparty any more. The people coughing up the money have little if anything to do with the actual incidents and simply write off the lawsuits as the cost of doing business.

It's a facade. I worry that when things get tough--and they will get tough--we're going to find out just how thin a facade it is.

[mmhmm]

Nobody has said merchants shouldn't have the right to refuse service.  I don't believe any merchant should have the right to refuse service on any grounds they choose; however, nobody has said anything like that here, that I've read.

As we said, there will always be fraud.  There will always be crime.  There are bad people out there.  We cannot, however, assume someone is a "bad person" because their skin is dark, or their eyes are blue, or their tie is the wrong color.  That, Virgil, is ludicrous.


By the way, will somebody catch those goalposts and rope them down.  They're running all over the place!

[Virgil Showlion]

We cannot, however, assume someone is a "bad person" because their skin is dark, or their eyes are blue, or their tie is the wrong color. That, Virgil, is ludicrous.

The assumption, as was clearly stated, is that merchants can identify highly specific demographics for which fraudsters make up a large enough proportion to guarantee that serving these demographics will overwhelm margins and create net losses in a time-amortized sense.

I realize that's a mouthful, but I can't explain it any more simply than that. It has nothing to do with a "someone".