Feds Bust a Dark-Web Counterfeit Coupon Kingpin 90
Sparrowvsrevolution writes: The dark web has become the go-to corner of the Internet to buy drugs, stolen financial data, guns...and counterfeit coupons for Clif bars and condoms? The FBI indicted Beauregard Wattigney yesterday for wire fraud and trademark counterfeiting on digital black market sites Silk Road and Silk Road 2. Wattigney allegedly spoofed coupons for dozens of products and sold collections of them online in exchange for Bitcoin. The FBI accused him of doing $1 million worth of collective damage to the companies he made coupons for, but a fraud consultancy believes the total financial cost of his actions was much higher. Wattigney also offered expensive lessons that taught people how to make their own coupons. "In his tutorials, [he] explained the simple breakdown of barcode creation using the increasingly universal GS1 standard: GS1 codes begin with a 'company prefix' that can be copied from any of the company's products. The next six digits are the 'offer code,' which can be any random number for a counterfeit coupon, followed by the savings amount listed in cents and the required number of item purchases necessary to receive the discount."
Unclear who this hurts (Score:5, Interesting)
Who takes the loss the retailer or the manufacturer?
Who cares? (Score:1)
I'm going to make fake coupons that makes the grocery store give me 10 dollars for every item I buy!
Re:Unclear who this hurts (Score:5, Informative)
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Is short, this "informative" post is nothing but a guess.
What you mean is that you have no idea how retail operations and promotional marketing work, but you vaguely want it to be true that ripping off stuff through the use of bogus discount coupons is a "victimless crime" blah blah blah, so you're going to pretend that basic information is unknowable, as moral cover. Hint: you're not as clever as you think you are.
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Bullshit. Unless you can point to real evidence this is true, you're just guessing.
What? How do you think that coupons actually work, anyway?
1) You present a coupon, and you pay less cash at the point of sale than you otherwise would have. This is not a mystery. It's the whole point. If it's the retailer's own coupon, then they are basically putting the item on sale in exchange for having a trackable form of marketing. If it's a manufacturer's coupon, then the retailer is participating in a mechanism wherein the manufacturer and retailer have worked out a back-channel compensation sch
Mainly the retailer (Score:5, Informative)
With entirely fabricated coupons, the manufacturer knows which offer codes are legit, and what amounts they should map to. They'll simply reject all counterfeits, and the retailer takes it in the proverbial shorts for the discount. Manufacturers could fix this by sharing all legit coupon codes with retailers (similar to the UPC system), but this would be cumbersome and since there's little benefit to the manufacturers, they don't.
For the second type of counterfeit where it's a fake copy of a legit coupon (you see this a lot with "free item" and deep-discount coupons that are sold by consumer product companies to say, appliance manufacturers or retailers. (i.e. "Buy this overpriced washer and get a six-month supply of Tide Detergent") it all depends on if the manufacturer spots the fake or not... If they do, the retailer eats it; if they don't the manufacturer does. Most of this type of coupons increasingly have security measures like holograms, thermo-sensitive colored ink, etc. to make the job easier on the manufacturer; doesn't help the retailer much though... they'll be able to know that, for instance all P&G coupons have certain security measures, but this won't work for smaller brands.
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The problem with that is that if the coupon is good enough, people will take their business elsewhere.
This can only be effective if a critical mass of retailers do it.
LK
This used to happen on 4chan. (Score:4, Interesting)
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Should I click this link? Could be a clever way to goatse people...or have I become paranoid?
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I had to explain what "Lemonparty" was to my fiancee when we were watching the Chelsea Handler "Uganda Be Kidding Me" stand-up special on Netflix.
Chelsea Handler uses it to hilarious effect.
--
BMO
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You should have downloaded MyCleanPC. Before I found MyCleanPC my life was bleak and hopeless, people threw stones at me and pelted me with garbage. I was constantly tortured on the wheel and whenever I went to sleep, flying piranhas would bite my penis. But then I found and installed MyCleanPC and everything was happy and gay! People now cheer me when they cross me on the street instead of unleashing their dogs, and I can make love to beautiful pony unicorn females every night. Oh, MyCleanPC, where have yo
Easily fixed (Score:2)
0. Along with all the other tracking data, log coupons and reference either loyalty membership or credit/debit card tokens.
1. When take coupon is detected upon redemption to the manufacturer, score the shopper up for coupon fraud.
2. Score reaches threshold, shopper is first denied any coupons (this takes a slight change in rules).
3. Also deny discounts based on loyalty programs (rules changed here).
4. Shoppers find no value in fake coupons, stop going to sites that peddle fakes.
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All defeated if the customer pays in cash, and intends to offload the mechanise for cash ASAP.
Rgds
Damon
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Re: Easily fixed (Score:2)
Step 1. will take some work but could be adapted to decline coupons just like declining a payment method.
All of this presumes the losses are actually worth the effort. I bet they aren't.
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2. Score reaches threshold, shopper is first denied any coupons (this takes a slight change in rules).
How is this going to increase revenue and profits? You're essentially telling customers that you don't want to do business with them. That will probably cause greater damage to profits than coupon fraud. For most vendors, it would be better to detect fraudulent coupons and reject them on a one-by-one basis, even if some percentage of fake coupons get through.
Re:Easily fixed (Score:5, Insightful)
How about just stopping this manipulative fiction of "coupons".
1. Charge a fair price for your product.
2. Stop using "loyalty memberships" and coupons to track your customers.
3. Make your customer the customer and not some company that wants to buy data about your customers' buying habits.
4. Be competitive instead of predatory.
5. Charge a fair price for your product.
6. If you can offer me "cash back" on my purchase, then you can goddamn well lower the price.
7. Charge a fair price for your product.
End the ridiculous All-American practice of "coupons" and "customer loyalty" and the problem with fake coupons just disappears.
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Agree, 100%. Each and every special offer is an admission that they have been overcharging you all along.
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They generally don't print coupons for the first example - they just lower the price and advertise it.
Loss leaders are unethical. I can't justify them, and I'm not lured in by them. I understand how they work, why they work, and I avoid them.
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No, I'm saying that "marketing" makes us less rational than we are.
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"Game-ification" is marketing-speak for "how we fuck our customers, but good".
Re:Easily fixed (Score:5, Insightful)
https://en.wikipedia.org/wiki/... [wikipedia.org]
J.C. Penney tried this. It's become a textbook case study in retail management as to how not to run a retail store. Unfortunately, the "feeling of getting a bargain" is a powerful psychological motivator to purchase; treating customers like rational people is not.
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That's why Tesla is failing so badly. They treat customers like rational human beings and don't give "incentives" and "cash back" and "0% financing".
And I guess that means that before coupons were invented, every company simply failed.
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Tesla is not yet making money, they currently lose about $15K on every car sold.
They are also selling to a very narrow section of the market.
Ford and GM could never do what they are doing. If Tesla wants to become mass market, they'll have to change.
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I know, right? That Elon Musk has no business sense at all.
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The one thing they don't need to do is issue derpy coupons.
To sell to you, no.
But you aren't the market... Go hang out at a Football game, or a NASCAR race, and tell me if you think that is really true...
The majority of the people in this county buy on "deals", anyone who works in advertising or marketing can tell you that.
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But those "savings and incentives" don't come from Tesla. They're not saying, "If you buy a car today, we'll give you a $1000 cash-back incentive". They're saying, "If you buy our car, you'll save money on gasoline, etc etc.
You must be able to see the difference.
At least you admit that coupons are "trick
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>
That's why Tesla is failing so badly. They treat customers like rational human beings and don't give "incentives" and "cash back" and "0% financing".
And I guess that means that before coupons were invented, every company simply failed.
You missed the key word: RETAIL. Tesla isn't a retail store. Tesla is a vertical market - they sell their own product in their own stores, and their product is relatively unique that they have additional liberties as a result. JC Penney doesn't make their own clothes, they sell other people's clothes for more money than they spent on acquiring them, and those same clothes are also being sold by other retailers. It's a completely different ballgame.
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"Retail" only means the products are sold to the end user rather than a reseller.
Tesla is most certainly a retailer of cars, because you can go buy one from them right now.
JC Penney most certainly makes their own clothes. In fact, they started by making their own clothes in 1914 and today they're be
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JC Penny tried that and it failed [usnews.com]
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Invented in the USA, perfected in the USA. Before you make a statement, do you even think to check whether or not it's true?
http://couponing.about.com/od/... [about.com]
It's Friday, and that means they'r
Re: Easily fixed (Score:2)
As has been discussed in the thread repeatedly, this is marketing. That you don't understand it is important, but if you did then retailers would just decide new tactics.
It's the butthurt sense of done to you that bothers me. When your argument starts with 'they should...', I know you are precisely the audience that Karl Marx was writing to. Self-centered, naÃve, with a well developed sense of righteousness.
When you know how 'sales', coupons, and other offers work, you make better decisions.
I'm enjo
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You really believe you're getting a "free" meal?
I guess it's true there's one born every minute.
The Chinese have a term for people like you: schnorrer.
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Not saying either end of the stick is "right".
Re: Easily fixed (Score:2)
I think of it as a discount. In not getting a lower price for not participating.
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As a fellow consumer, I understand your frustration and why you would desire this sort of set-up.
And yes, you are correct that the system is designed specifically to extract the most amount of money on the sale of each product as possible -- coupons are basically tiered pricing and product promotion/advertising rolled into one. They also create a sense of urgency by putting an expiration date on them (even though we all know they'll print another soon w/ a further date for the exact same discount!)
There a
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Your "rewards program" allows your privacy to be violated. Your store thanks you.
Remember, you're personal information, spending habits, movement information, location, etc are worth something. And you're giving it away for pennies on the dollar. Have you ever read the EULA on your "rewards program"?
PT
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My privacy isn't violated - it's an agreement.
I get a deal when I shop here, you track my purchases. I'm fine with that. Plenty of businesses tracked purchases long before the "rewards card" era -- often with these fancy log books and receipts, but sometimes just asking for things like zip codes (hardly personally identifiable, but useful.)
You do know that if you pay with a credit card, you're also being tracked by your credit card company as well, right? The police have a much better chance of subpoena
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Do you read the user agreements for those rewards "clubs"?
No, you clearly don't read the user agreements for those rewards clubs.
If there was ever a time to be mindful as a consumer, it's right now. Good luck.
Wrote POS System Software (Score:4, Interesting)
/ This is a simple standard anyone can google that shows exactly how these bar codes are laid out. I used that myself when implementing that section of code. Why anyone would pay for it is beyond me. At the end of the day, the retailers know there is going to be some fraud on this. They have switched to all of these automated checkout systems to save money on cashiers, who would likely catch this sort of thing, so I don't really feel sorry for them at all. They have made that trade.
That said, there are some safeguards in there. If your coupon total is unusually high, your checkout will lock up and require approval from the person watching up front. So anything outrageous will likely be caught. Also, you better pay with cash, as the transaction is all tied together to your card. Also, don't use a loyalty program. So at the end of the day is all that hassle worth it to maybe save a couple of dollars? Conversely, though, I guess the checkers care less and less every day as they get replaced by machines and probably just hit the 'ok' button most of the time, and the retailers eat it as just cost of doing business.
Myself, I would not suggest it as it is punishable by law. It is worth going to jail to save a relative few dollars off your bill?
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Also, don't use a loyalty program.
Just use someone else's. They all take a phone number as "alternate ID." You can even try a few before one works. "Um, I can't remember which phone number I signed up under." Or just use Jenny's 867-5309. Apparently, it's taken in most area codes.
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Hit Mike Jones up on the low, cause Mike Jones about to blow~!
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It's hard for me to feel bad for the retailers i
Must...resist...gender-based rant! (Score:3)
I hope this scam works, and that it will mean the death of coupons as an inducement. When I think of the time expended cutting them out, fiddling with them on every shopping trip, and snipe hunts for products we don't usually buy but-there's-a-great coupon-this-week, I will rejoice at the extra time that awaits us in our future. Then consider the time and money expended by retailers and by manufacturers. Wouldn't we save just as much if coupons didn't exist at all? Whenever I'm out shopping by myself, ignoring the whole coupon world when I do price/value analysis, I find I'm saving just as much.
But coupons will persist so long as they keep appealing to the wives of this world.
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"You stupid cocksucker. You just had to ruin the moment with your ugly hatred of women."
Don't you just live the hearty give-and-take of intellectual discourse?
What I was actually flaming here is the marketing industry's cynical exploitation of women in selling the whole concept of retail coupons. The same applies to the design of slot machines.
Clif bars and condoms? (Score:2)
Well, there goes my weekend.
Did somebody neglect security? (Score:2)
What with the Internet, you might think that there would be some sort of validation built into the system? Apparently not...
Could you get a more white name? (Score:1)
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"Beauregard Wattigney"
Even a google image search confirms this...
Could you see his trailer in the background of the picture?
Maybe this will end "extreme" couponing (Score:2, Insightful)
I hate those people and their giant binders of coupons. Why? Because if you get stuck behind one in line, they double or triple the wait time.
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I hate those people and their giant binders of coupons. Why? Because if you get stuck behind one in line, they double or triple the wait time.
As someone who has had to work a register with those assholes so do we the cashiers, especialy when they try to argue with your managers for 15 minutes about store policy and combined coupons tying up lines.
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The store doesn't need these people. Why not just fix the policies to ban them without affecting regular coupon users?
Because the coupons are legitimate offers of a reduced price on a limited number of purchases of an item. An "extreme couponer" just happens to be accepting a larger number of them than a more typical shopper.
To reject a person who uses "too many" of them (while not rejecting ALL coupon use by ALL customers) may constitute consumer fraud on the store's part and get them into serious hot wat
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I hate those people and their giant binders of coupons. Why? Because if you get stuck behind one in line, they double or triple the wait time.
As someone who has had to work a register with those assholes so do we the cashiers, especialy when they try to argue with your managers for 15 minutes about store policy and combined coupons tying up lines.
I've seen two cases on how this was solved.
The first was when an assistant manager came up and said "Please stand over here so that we can continue to serve other people", he ranted and raved about how much business the store would lose but I can practically guarantee that the store would have seen more repeat business from the others in that line.
The second was another customer pushing past them and telling them to naff off when they complained that they were in line. The guy did ask nicely for the c
Industries should not be protected from negligence (Score:1)
If you PUT OUT A STANDARD THAT HAS ZERO AUTHENTICATION and expect it to not be abused then you deserve what you get. Now there may be some victims here, but don't go putting the blame on the fraudster(s) or those making the tools. They're only able to do that because of poor business and industry practices. This is how your tax dollars get wasted and why I'm sick and tired of paying for "security" that doesn't serve me.
I own a business and we DO get targeted for high end fraud. Though it's credit card fraud
I can understand (Score:2)
I wonder.... (Score:1)
If you go to prison for coupon fraud, could you get a prison tattoo of a barcode with information encoded to reduce your sentence?