how online shoplifting works
one way to conduct online shoplifting is through the credit card chargeback process a consumer purchases goods online using a credit card receives the goods then submits a statement to the credit card company claiming that they never received the goods as a result the credit card company initiates a chargeback and forces the merchant to refund the customer s purchase even though the customer has never set foot in the merchant s place of business they have effectively shoplifted by fraudulently using the chargeback process to obtain goods without paying for them what is more if a credit card payment processor receives too many chargeback requests for the same company it may stop doing business with them the online merchant then experiences secondary damage from online shoplifting because it can no longer accept a certain brand of credit card this might in turn reduce sales since the inability to accept that card will significantly inconvenience customers to be clear chargebacks themselves are not fraudulent but when consumers abuse this tool meant for consumer protection it raises alarms with both retailers and credit card issuers on top of the lost merchandise the new york times reports it can cost up to 40 on average to process a chargeback request 1types of online shopliftinganother way to conduct online shoplifting is through piracy illegally downloading copyrighted music books or movies for free instead of purchasing them through legitimate channels is a form of online shoplifting that simultaneously robs both producers and distributors the issue has posed a challenge for a number of reasons consumers of pirated content want it for free or at least a very low cost secondly media companies often lack the resources to respond to growing demands for free content the digital media underworld moves faster than big businesses with conglomerates of intelligent hackers and pirates joining forces across the globe thirdly the proliferation of user generated content allows anyone and everyone to create and distribute content without even realizing that they are committing copyright infringement along the way 