A discussion on the ethics and legality of scripting 1 cent transactions!

[Nutcase]

Re: Bankwest Transaction account [General Discussion]

Not that any of those things are at all relevant because all are allowed by the bank/merchant but yes, I'd say there's a fair chance he used a macro to make several thousand payments in a short space of time.

So the answer it that we don't know. These things are very relevant.

From the research that Ive done NAB cut a deal with the guy you are referring to.

 

[coles525]

Re: Bankwest Transaction account [General Discussion]

Whats fraud is when banks charge a monthly if you don't deposit enough spare change....

But banks are still allowed, as it's also in the rules.

 

[Nutcase]

Re: Bankwest Transaction account [General Discussion]

Is any of those acts "fraudulent" in any way?

Like all fraud, the individual acts look mainly innocuous. Its not until they are combined that the problems start.

 

[NoName]

Re: Bankwest Transaction account [General Discussion]

So the answer it that we don't know. These things are very relevant.

From the research that Ive done NAB cut a deal with the guy you are referring to.

No, the answer is that it's safe to assume he used one because it would have been physically impossible to manually make thousands of payments in a short space of time.

Exactly, because they knew they wouldn't win in court. If they did he wouldn't have gotten a thing. You can argue that morally these payments shouldn't be made and perhaps you might have an argument but the bottom line is that regardless of what you want to say, there is nothing illegal about this behaviour. No one will have their points reversed and no one will be prosecuted for fraud.

Going around in circles though but do carry on.

 

[Nutcase]

Whats fraud is when banks charge a monthly if you don't deposit enough spare change....

But banks are still allowed, as it's also in the rules.

No, thats a fee for service

Exactly, because they knew they wouldn't win in court. If they did he wouldn't have gotten a thing. You can argue that morally these payments shouldn't be made and perhaps you might have an argument but the bottom line is that regardless of what you want to say, there is nothing illegal about this behaviour. No one will have their points reversed and no one will be prosecuted for fraud.

Going around in circles though but do carry on.

My questions around Macros, multiple accounts, multiple issuing of cards and deceptive conduct stand unanswered.

Apples and Oranges with the OP and the NAB case.

 

[trixydoza]

Re: Bankwest Transaction account [General Discussion]

Multiple accounts per household are permitted, nay, encouraged. You have yet to identify any deceptive conduct whatsoever.

 

[serfty]

Re: Bankwest Transaction account [General Discussion]

... The problem for the biller is that theres a cost to process which is at least $0.10 depending on how they calculate it. The gateway has a click fee and so does the bank. If you're doing $0.01 transactions then its a giant red flag. You'll also throw out their average transaction amount and lifting their transactions which is a red flag for them, the bank and the gateway. Its got "risk" written all over it. Theres also an issue with Chargebacks for both sides. If you ever had to dispute the bill with BWA, how would you do it? ...

Paying bills with 1¢ increments in such a manner would likely benefit QFF; similar with BankWest- so neither of those entities would be looking to shut such activity down based on that premise.

That leaves the Billers - I am thinking this activity may have a perverse aspect in that it could distort KPI's and other statistics in such a manner to be beneficial for certain managers or departments such that they are not interested in shutting it down.

 

[quokka77]

Re: Bankwest Transaction account [General Discussion]

Nice debate going on here. I imagine a judge determining whether fraud had occurred would look at the elements of "deception" and "financial advantage". The bank's lawyers and our hero's... I mean the defendant's, would each have learned and erudite points to back their case. Ultimately it would come down to the judge's view (unless a jury was involved, in which case they would still be guided by the judge)... So, in the end, it's debatable and very gray whether it's fraud. I personally have run into a similar conundrum when running up points via a different method. The question I had to ask was: how hard to game the loophole (now closed). In the end I picked a value less than 10000 dollars per month (hiya 0ztr@ck if you're listening), and stuck to that.

 

[coles525]

Re: Bankwest Transaction account [General Discussion]

What better way to get new customers, as well as keeping them, without the need of advertising.

Free ads in here alone!

 

[lovetravellingoz]

Re: Bankwest Transaction account [General Discussion]

I am thinking this activity may have a perverse aspect in that

it could distort KPI's and other statistics in such a manner to be beneficial for certain managers or departments such that they are not interested in shutting it down.

Nail, hit head!!!!!!!!!!!!!!!

I agree with your hypothesis.

However no way could awarding all these points per person to the extent that is happening be good for BW. Some individuals will be costing them a pretty penny. Sooner or later someone witha more balanced company perspective will change the T&C and/or how the account earns points.

Sure there are probably the majority of account holders which is to BW's advantage. But they are unessecaarilly bleeding money.

In the meantime, not that I have read all the T&C, but I doubt it breeches anything untill BW tightens up what is an eligible transaction.

 

[trixydoza]

Re: Bankwest Transaction account [General Discussion]

What better way to get new customers, as well as keeping them, without the need of advertising.

Free ads in here alone!

Indeed. These indications as to how little understanding Bankwest has of the whole situation are the best encouragement one could hope for.

 

[Kangol]

Re: Bankwest Transaction account [General Discussion]

I don't have my lawyers hat on to give you the answer to this for obvious reasons.
Wikipedia has it nailed. Im deliberately using this source.

a person or thing intended to deceive others, typically by unjustifiably claiming or being credited with accomplishments or qualities.

wrongful or criminal deception intended to result in financial or personal gain

When seen in the context of the use of a macro, multiple cards, accounts and people then I think we have that definition covered.

I don't know what the obvious reason is, please be explicit... I'm not asking for legal advice, nor should your post be interpreted as such.
Let me rephrase this then: Given your [legal] background, what is a reasonable legal interpretation of the term "fraud"?
If you are choosing not to answer this directly, or you do not have the ability to answer it, is there say a document, handbook, guideline, etc that would be freely available to the public that would be able to provide a definition, or description, in the legal sense, of the word "fraud"?

My questions around Macros, multiple accounts, multiple issuing of cards and deceptive conduct stand unanswered.

Here are the answers:
Macros can be used for anything. The macro is not illegal or deceptive.
Multiple accounts per person are not allowed. That has never been the case here. One account per person is allowed and there is nothing wrong or illegal with that.
Multiple cards are allowed by the bank. If they weren't, then the bank would not be issuing them.
There is no deceptive conduct. The terms and conditions are being adhered to. An eligible purchase is made, and the appropriate number of reward points are awarded. This is no different to a credit card awarding points.

You mention something about: more than one transaction being made, when it could have been done in one. Is there a law regarding the number of transactions you can make for a purchase (eg. a bill)? If there is, what is the number? How is that deceptive - the bank and the merchant know about the number of transactions being made.

As per Google:
de·ceive
dəˈsēv/
verb
verb: deceive; 3rd person present: deceives; past tense: deceived; past participle: deceived; gerund or present participle: deceiving

• (of a person) cause (someone) to believe something that is not true, typically in order to gain some personal advantage.
  "I didn't intend to deceive people into thinking it was French champagne"
  [TABLE="class: vk_tbl vk_gy"]
  [TR]
  [TD="class: lr_dct_nyms_ttl"]synonyms:[/TD]
  [TD]swindle, defraud, cheat, trick, hoodwink, hoax, dupe, take in, mislead, delude, fool, outwit, lead on, inveigle, beguile, double-cross, gull; Moreinformalcon, bamboozle, do, gyp, diddle, rip off, shaft, pull a fast one on, take for a ride, pull the wool over someone's eyes, sucker, snooker, stiff
  "she was deceived by a con man"
  
  
  
  [/TD]
  [/TR]
  [/TABLE]
  
  
  
  • (of a thing) give a mistaken impression.
    "the area may seem to offer nothing of interest, but don't be deceived"
    
    
    
  • fail to admit to oneself that something is true.
    "enabling the rulers to deceive themselves about the nature of their own rule"
    
    
    
  • be sexually unfaithful to (one's regular partner).
    [TABLE="class: vk_tbl vk_gy"]
    [TR]
    [TD="class: lr_dct_nyms_ttl"]synonyms:[/TD]
    [TD]be unfaithful to, cheat on, betray, play someone false; informaltwo-time
    "he deceived her with another woman"
    
    
    [/TD]
    [/TR]
    [/TABLE]
    
    
    
  
  
  
  

Origin

Middle English: from Old French deceivre, from Latin decipere ‘catch, ensnare, cheat.’




The merchant, nor the bank, is not being led to believe something that is not true.

 

[mitwg]

Re: Bankwest Transaction account [General Discussion]

I fail to see how macros = fraud. This argument, to me, is just laughable.

There's no connection between how macros automatically translates to a fraudulent activity.

Yes there are instances where using macros would be illegal, but there is yet a clear difference between using software to perform tasks that wouldn't be allowed by the merchant, compared to simply automating an activity that would be allowed by a merchant.

The merchant in this case is perfectly happy to accept a payment of $0.01 and their payment terminal is designed to do this. If people then choose to then automate this behaviour, this isn't fraudulent. Let me give another example: If I used a macro to automate a payment of $100 at 10pm tonight, is that fraud? No, I have simply scheduled a valid task that I would have performed otherwise via automation.

Oh no, but paying $100 by macro is different to paying $0.01 multiple times right? Actually no. There's no 'deception' going here. At which part is the customer deceiving the merchant by making these payments? Or in which part is the customer gaining anything from the merchant by making these payments?

There is a disassociation between BW who holds the relationship with the customer, versus the merchant who holds the relationship with the customer. There's no direct relationship between BW and the merchant.

The legal relationship between the customer and the merchant is that the customer has made a valid payment and the merchant has accepted it. I could have done this with a Westpac card if I wanted to. And to the merchant? the effect is the same. They get their money and that's where the relationship ends, as far as a customer-merchant relationship is concerned.

As for the relationship between the customer and Bankwest? Well Bankwest won't be able to hold up in court that people have been making payments using macros is illegal. First of all, you'd have to prove that people did this (which is impossible) but secondly, even if it did, the customer is free to choose how to make their payments (see my example able $100 automated payments). So from BW's perspective, all they can see is that the customer has made a payment to a merchant for $0.01. They cannot see which item the customer purchased, whether the amount is pre-paid or post paid. They'll only be notified if the transaction is fraudulent (by Visa/MC), which in this case, it isn't.

All Bankwest has for them to use in this situation is that the customer is making numerous $0.01 payments. If this violates their Terms and Conditions, then they have the right to claw back the points and terminate the account. It's already been established in this thread that they haven't built this into their Terms, so the worst outcome possible is to have the account closed because they do have that in the T&Cs that they can 'close any account for any reason'.

As for Qantas? I can't believe there's even the suggestion that Qantas would roll back the points. They are the ones laughing the most, with all these points being purchased by BW. This goes straight to QF's P&L and they'd actually be wanting more of this. In fact, I even suspect the one reason (but possibly very wrong) why BW isn't changing the product is because they might have some sort of fixed term agreement with QF in how they will not butcher the product within X days of launch.

 

[Nutcase]

Re: Bankwest Transaction account [General Discussion]

This is all great.

The OP has exploited a loophole. Well done!
He has earned 600,000 points by doing it. Well done!

Problem is that he has achieved this by deceptive and misleading conduct in my opinion which I have listed previously.

Do you think that this scenario, obtaining a benefit worth $12k or more by exploiting this loophole passes the "reasonable Man" test? Would a reasonable Man make tens of thousands of automated $0.01 transactions?

And how do you think BWA and billers view this given that they have to pay away more in fees than the transaction value?

Reasonable?

 

[burmans]

Re: Bankwest Transaction account [General Discussion]

CURRENCY ACT 1965 - SECT 16 Legal tender

If this were hard currency then the maximum would be 20 x $0.01 transactions.

if this were hard currency - but it's not so relevance = nil.

of course the legal tender defines what a vendor MUST accept, not what he CAN accept. Plenty of vendors are probably quite happy to accept large amounts of coins well in excess of what is the limits. And yes, the vendor is perfectly entitled to say I'm not going to accept that, but if you do accept you can't come back in a years time and say I've changed my mind.

 

[N860CR]

Re: Bankwest Transaction account [General Discussion]

This is all great.

The OP has exploited a loophole. Well done!
He has earned 600,000 points by doing it. Well done!

Problem is that he has achieved this by deceptive and misleading conduct in my opinion which I have listed previously.

Do you think that this scenario, obtaining a benefit worth $12k or more by exploiting this loophole passes the "reasonable Man" test? Would a reasonable Man make tens of thousands of automated $0.01 transactions?

And how do you think BWA and billers view this given that they have to pay away more in fees than the transaction value?

Reasonable?

I guess there's one very simple question;

Why have Bankwest not stopped it?

 

[Nutcase]

if this were hard currency - but it's not so relevance = nil.

of course the legal tender defines what a vendor MUST accept, not what he CAN accept. Plenty of vendors are probably quite happy to accept large amounts of coins well in excess of what is the limits. And yes, the vendor is perfectly entitled to say I'm not going to accept that, but if you do accept you can't come back in a years time and say I've changed my mind.

You haven't quoted the entire section so relevavance = nil

As I have said in a recent post, ask if this scenario with the $0.01 transaction pass the "reasonable Man" test and see how you go.

I guess there's one very simple question;

Why have Bankwest not stopped it?

Indeed. The next part of that question is "Yet"

 

[mitwg]

Re: Bankwest Transaction account [General Discussion]

This is all great.

The OP has exploited a loophole. Well done!
He has earned 600,000 points by doing it. Well done!

Problem is that he has achieved this by deceptive and misleading conduct in my opinion which I have listed previously.

Do you think that this scenario, obtaining a benefit worth $12k or more by exploiting this loophole passes the "reasonable Man" test? Would a reasonable Man make tens of thousands of automated $0.01 transactions?

And how do you think BWA and billers view this given that they have to pay away more in fees than the transaction value?

Reasonable?

Actually, the 'reasonable' ness isn't up the consumer or the bank to decide.

The customer and the bank has entered into an agreement, upon which the bank provides a service as defined (which is what we call a Product Disclosure Document or PDS) and the customer pays the fees and abides to the Terms and Conditions. The reasonableness isn't so much whether how much the bank is making money or loosing money but rather is judged whether the customer has followed the rules agreed upon.

How much the customer has cost the bank (whether that be $10 or $150000) isn't for the customer to actually consider. That is a commercial aspect that is decided by the bank.

Think of it another way. If there was a product that the bank made millions on, is that unreasonable because the bank (i.e. one party) has made so much money?

This is clearly a failure in the product design that the bank has to pay for. I'm willing to bet that the main reason why it hasn't yet been changed is because the cost to make the changes (i.e. raise an RFC, make changes to the switch & core banking system, update reporting, re-train staff) is coming up to hundreds of thousands (yes I know how banking projects cost because I also work in the industry) so the business case to change isn't stacking up against simply wearing the losses as BAU.


And again, you keep referencing 'deceptive' and 'misleading' conduct but I fail to see how this is deceiving anyone.

The users of this product isn't deceiving anyone by making payments. These are valid payments after all because for a payment to be valid, you need to satisfy the following 3 conditions:

1. The account holder has to agree and grant authority to make the payment (in the agreed format)
2. The merchant has to agree to receive the payment (in the agreed format)
3. Actual transfer of money has to occur

All 3 activities 'validly' occur in these payments. There's no deceiving activities going on here. The user isn't deceiving the merchant to accept the payment, nor is the user deceiving the bank to authorise a payment that would have otherwise be considered fraudulent (this is the likes of skimming which is different, because it is an UNAUTHORISED payment).

The only thing happening is that the product is being used in a way that the product development manager didn't really expect it to be. Is this the consumer's fault? No. Fix it or pay for it.

 

[N860CR]

Re: Bankwest Transaction account [General Discussion]

Indeed. The next part of that question is "Yet"

Perhaps, yes. However if they've allowed it to go on for this long, the "reasonable person" test would say they are just as guilty

 

[quokka77]

Re: Bankwest Transaction account [General Discussion]

Maybe the deception could be that one has set up an automated payment program, and is pretending to be a retail customer. To me that's a long bow, but judges can be old fuddy duddies sometimes.