The American Way of Building 3DS - by Alvaro Duran
Yes, fraudulent use of credit cards is still a thing. I’ve said before that online payments are kind of a miracle, so I don’t think we should be surprised that it leaks from time to time.
To quote patio11 on this, online payments rules are “not fully descriptive”. That means that, when there’s a dispute, the cardholder’s bank, or issuer, has wiggle room to decide its outcome:
As a simplified example, issuers who focus on “premium” card users frequently make a business decision to side with their customer more frequently than, say, mass-market banks do. (They would probably entirely automate “Chargeback sustained!” if the network rules allowed them to do so, but they don’t.)
This is perverse. Online, merchants don’t have direct access to the card itself (they deal with what the industry call Card Not Present, or CNP, transactions). And that means that, should the payment be fraudulent, the merchant is liable.
But even when there’s overwhelming evidence proving that the payment was legit, the issuer, being the ultimate decision maker in a dispute, is strongly incentivized to side with the cardholder.
