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Scheme sees PayPal accounts drained via iTunes charges

updated 04:05 pm EDT, Mon August 23, 2010

Apple maintains old position on fraud

Some people are finding their PayPal accounts emptied of hundreds or thousands of dollars because of fraudulent iTunes purchases, reports reveal. One person complains of having been charged over $4,700, in a bill linked to almost 50 PayPal receipts worth $99.99 each. A more conventional example is a San Francisco woman, who was billed $650. By catching and reporting the problem early, it should be possible to get Apple or PayPal to reverse unwanted transactions.

While both companies are believed to be aware of the issue, Apple's stance has remained essentially unchanged since a pair of App Store fraud incidents in July. After the first, the company increased the frequency with which iTunes requests a credit card's security code. "But if your credit card or iTunes password is stolen and used on iTunes," adds spokesman Jason Roth, "we recommend that you contact your financial institution and inquire about canceling the card and issuing a charge-back for any unauthorized transactions. We also recommend that you change your iTunes account password immediately." Apple is otherwise only said to be working on fixing fraud problems.

by MacNN Staff



  1. MonkeyMan9000

    Joined: Dec 1969


    Virtual VISA

    I live in Portugal and here, since 2000 we have something called MBNET ( a service that is linked to our banks and credit cards that allows one to generate one "virtual" valid VISA card number per operation. So, when I want to pay something I visit mbnet and generate a card number for that buy. The card is created valid for the amount I choose and for one operation. A card generated is valid for one month, used or not.

    Every time I need to pay something I use this. All my accounts like Amazon, iTunes etc., have these numbers filled in. I never fill my personal data using the real VISA number. So, if a thief want to hack my accounts, be my guest, he will buy nothing.

    Portugal is famous for being a pioneer in many of these services but I cannot believe that such service is not available in the US and other countries. Just a dumb is stolen in frauds like that.

  1. testudo

    Joined: Dec 1969


    Re: Virtual visa

    It is available in the USA (and has been for years, depending on the credit card company).

    Most people don't use them, though, because the inconvenience outweighs the gain. Since its a credit card, most people just don't care, for they know they're not responsible for any (or, at most, $50) of the misuse.

    The inconvenience is that you can't just buy something from Amazon or the iTMS or wherever. You have to go through hoops to get a card number and date, then move over to your other account and enter all that in, then you can make your purchase.

    And none of this matters anyway, since this is PayPal not Visa.

  1. testudo

    Joined: Dec 1969


    Re: Virtual visa

    BTW, what do you do when you go to an actual store, restaurant, or other physical place of business? Do you give them a virtual visa number as well? Or just pay for everything in cash?

  1. Marook

    Joined: Dec 1969


    But how...

    .. didn't even know you could use PayPal at iTMS to begin with.. :-/

  1. MonkeyMan9000

    Joined: Dec 1969


    comment title

    you guys are not getting the point.

    To make a Paypal Payment you have to have a credit card filled on your paypal account. If your real cc is there, everyone that hacks your paypal account can buy anything. My paypal account always has an expired card, because everytime I add a card to paypal, I use it immediately, so the card there was already used and cannot be used again. The same for iTunes (as Marook seems to not have understood). So, every time I fill a cc number on Amazon, iTunes or Paypal I use it and it becomes invalid after the use.

  1. coffeetime

    Joined: Dec 1969


    Virtual Credit Card

    Something similar to Virtual Card in U.S. is Credit Card Gift Cards available from major grocery stores. I bought a $50 value American Express credit card as a gift for someone I know and she can use it as regular credit card. She can even check the left over credit over the internet. The gift card is a real credit card with temporary assigned credit card number.

  1. testudo

    Joined: Dec 1969



    Oh, I get it. I'm just telling you why people don't do it.

    As for PayPal, you don't need to have a credit card tied to the account. You could also have a bank account.

    But neither is the point, since the problem wasn't a hacked paypal account, it was hacked itunes accounts. It wouldn't matter if they had paypal or cc tied to them, either way works.

    And I'm not sure the point of the attack, for people can't be getting money out of this, can they?

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