It's always a balance between how much fraud you allow and how many real customers you reject. They set their threshold at an interesting level, but maybe they're happy with that choice.
You're right. But unfortunately this mindset moves us closer and closer to having algorithms exclude people from society and life. And as the stories already told here show, it can happen to any of us for no apparent reason.
It's like, imagine a magic wand that, if waved, would make life a little better for 99% of society, but much worse for 1%. Would it be moral to wave that wand?
Well you got a human answering the support hotline.
I think that alone kinda nullifies the threat of an algorithm. The entire reason why they're such a massive problem is because Google et al. refuse to operate proper support hotlines to help people and even if they do have a support line (Facebook infamously doesn't have one and wants you to go through the courts to contact them), the support staff aren't actually equipped to help people beyond regurgitating canned support page links. You can't solve a malfunctioning algorithm with another algorithm or by forcing a human to behave like an algorithm.
It's not a big secret that the best way to get yourself in front of actual support if GAFAM screws you over is to complain about it on HN because this is where SREs lurk that can actually punt your requests through to people that can look into it.
Hetzner at least gave a direct answer to explain the reason.
The problem with this mindset (incredibly common in the US; much more so than in the European countries I've lived in, at least) isn't thinking probabilistically, and trying to determine the likelihood of a prospective customer being a fraudster. It's really just that there are only two possible outcomes: Yes and no.
Just by having a third option, most of the downsides of doing the evaluation incorrectly could be mitigated. Of course, that's generally much more expensive (and often uneconomical) than saying no, so it's usually not done.
I've been on the 1% side of things quite a few times due to having new credit and (presumably) various data brokers not knowing every detail about me yet, and the experience really, really sucks.
You're making choices like that every single day. Sometimes with reversed percentages. Even posting this message may be on average a tiny loss for the world. (It's meaningless in the end and burned some energy to give one person a mini dopamine boost)
There’s nothing particularly scary about “algorithms” making these choices since it’s just people at these companies choosing and implementing the algorithms. It wouldn’t get better if those humans weren’t allowed to use algorithms to make these choices since decisions.
What type of fraud exactly? You mean like stolen CCs? It feels very medieval as a financial trust system if every little vendor can’t trust payments, even when you pay up front? Like this is in some ways worse than cold hard cash. And then we pay VISA premium on top of that, for the convenience of being mistrusted..
If they pay up front then dispute, the company will suffer extra charges. With enough of reports, their payment processor fee% goes up and impacts all their payments.
Paying up front doesn't really mean much, because if the credit card info is stolen, the actual owner will report the transaction and it will be reversed.
Right but that sucks. So CC companies/banks are simply shifting risk from one side of the transaction to the other. Sure, as a consumer you don’t have to worry because you’ll get your money back. But if the merchant has to worry and reject customers who are “suspicious” to protect themselves then you’re back to square one, except more kafkaesque. That’s why I said cash is better.
I’d rather have $10 permanently lost for a month of VPS than being banned after 5 days setting it up because I’m traveling and my IP is “suspicious”. Which has happened to me.
Hetzner is actually worse. Current EU directives allow liability shift in online payment when the customer is authenticated via 3D Secure, meaning the risk is extremely low and the onus of proving the fraud is on the card owner. Yet Hetzner will not accept your money if your name doesn’t look correct for the country you are accessing from.
