Report: Pirate subs risk credit card fraud
June 20, 2023
By Colin Mann
Internet users who use a credit card to sign up for illegal piracy streaming services to gain access to movies, TV shows, and games, face a serious risk of having their card run up with charges they didn’t authorise, according to a new investigation from Internet threat education body Digital Citizens Alliance.
The report, Giving Piracy Operators Credit, details how a Digital Citizens investigator’s credit card was targeted for $1,495 (€1,364) in illicit purchases. The purchases were purportedly for grocery delivery, women’s apparel, computer software, a cash advance, and a large mystery charge of $850 that fortunately wasn’t processed. The charges appear to originate from China, Singapore, Hong Kong, and Lithuania.
“Our latest report is further proof that piracy operators will go to any length to turn a profit off of consumers with an appetite for content, even those who are willing to pay for it,” stated Tom Galvin, executive director of the Digital Citizens Alliance. “Combined with our previous research highlighting the risks associated with free piracy apps and services, the situation becomes even clearer. The pursuit of pirated content is an inherently risky behaviour that threatens the devices, wallets, and privacy of consumers.”
To test whether credit card fraud was tied to piracy subscription services, Digital Citizens signed up for 20 piracy subscription services. Investigators signed for the services from February through April of 2023 using a new Capital One QuickSilver credit card that was used solely for this project.
The sites charged a set monthly subscription fee ranging from $5.99 to $40 and within two weeks, the fraudulent charges began. Specific charges include:
- February 22nd, 2023 – Eleven days after signing up for the first piracy streaming services – two charges of $17.21 each occurred listed as ‘GB Pay affectioni’. Affectioni appears to be a women’s apparel store in Qingdao City, China. GP Pay is a mobile payment service.
- February 23rd, 2023 – Just a day later, a cash advance of $14.99 (along with an additional $3 fee) was made using the Wollito crypto platform. According to the credit card statement, the purchase originated in Vilnius, Lithuania. No other information is available.
- March 22nd, 2023 – A $16.60 purchase at a clothing store based in Hong Kong. The name on the charge was ‘clothingyoyo’, which corresponds to the Clothing Yoyo outlet based in Sheung Wan, Hong Kong.
- March 31st, 2023 – A $16.68 purchase for ‘thedailygroceries’. The charge originated in Jiaxing Shi in China. Although the name indicates its food-related, the website, thedailygroceries.com, which appears to correspond to the charge, sells jewellery such as necklaces and bracelets along with handbags.
- April 30th, 2023 – Two attempts for larger purchase of $899 and $150 occur. The nature of the purchases is not known because Capital One alerted the cardholder for approval, which was not given.
- May 1st, 2023 – The first of two larger purchases occurs at a Singapore based apparel store called Pazzion for $118.53.
- May 9th, 2023 – A second purchase at Pazzion is processed for $244.78. According to its website, Pazzion sells apparel such as shoes, handbags, bracelets, and other accessories.
Assessing the Risks
In addition to the investigation of the 20 piracy subscription services, Digital Citizens commissioned a research survey better to understand the risks of piracy websites and apps. The survey asked 2,330 Americans how they get their entertainment.
Key findings include:
- Roughly one in three Americans reported watching pirated content at least once over the past year. Some relied on pirated content after cancelling other legitimate streaming options or cable or satellite services.
- About one in 10 who reported watching pirated content said they had purchased a subscription using a credit card to do so.
- Seventy-two per cent of Americans who said they used a credit card to purchase a piracy subscription service also reported having an issue with credit card fraud over the last year. Only 18 per cent of those who said they don’t visit pirate sites reported a similar issue.
- Americans who visited piracy sites and apps were four times (44 per cent to 10 per cent) more likely to report being a victim of identity theft.
- Americans who visited piracy sites and apps were five times (46 per cent to 9 per cent) more likely to report having an issue with malware in the last year.
What Can Be Done?
The proliferation of piracy services into Americans’ homes – and the damage they do – requires concerted action by federal and state governments, the credit card companies that piracy operators rely on, and consumers themselves. Those efforts should include:
- Payment processors terminating relationships with known piracy operators.
- The FTC warning Americans about online risks that can expose them to financial fraud and malware.
- Law enforcement using the tools they were given in 2020 to launch criminal investigations against piracy operators.
- Consumer protection groups continuing to warn Americans about the risks.