Business News Select | SMPost | Terms

Term: Online Shoplifting

27 Jan 2015

The theft of goods from an Internet-based merchant. on-line shoplifting might seem harmless since the shoplifter never interacts with the victim and executes the fraud with a few keystrokes and mouse clicks. It is a crime nonetheless, and shoplifters can face serious legal problems, such as charges of mail fraud.

One way to conduct on-line shoplifting is through the credit card charge-back process. A consumer purchases goods on-line using a credit card, receives the goods, then submits a statement to the credit card company claiming that he never received the goods. As a result, the credit card company initiates a charge-back 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, he has effectively shoplifted by fraudulently using the charge-back process to obtain goods without paying for them. What’s more, if a credit card payment processor receives too many charge-back requests for the same company, it may stop doing business with them. The on-line merchant then experiences secondary damage from on-line 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.

Another way to conduct on-line shoplifting is through piracy. Illegally downloading copyrighted music, books or movies for free instead of purchasing them through legitimate channels is a form of on-line shoplifting that simultaneously robs both producers and distributors.

The motivations for on-line shoplifting are somewhat different from the motivations for shoplifting from a brick-and-mortar store. There may be less of an element of the thrill of getting away with the deed, but economic factors – wanting to obtain an item without paying for it – are still important. And while some people steal things that may be embarrassing if anyone saw the buy, this concern isn’t usually a factor when shopping on-line. However, shoplifters both on-line and in traditional stores might steal out of a sense of entitlement.

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