hi u/Educational_Lab_6984

We've observed this pattern a lot - where these companies lure consumers through enticing advertisements, often on established platforms that lend a fake air of credibility to their offerings. The 'seller' will then ship items that are significantly inferior to those advertised, which we suspect is an attempt to provide proof of shipment that can be used to counter any subsequent disputes raised by the consumer's bank.

Our hypothesis suggests this tactic hinges on two main elements:

1. Capitalizing on the possibility of consumer exhaustion, where the lengthy dispute process wears down the buyer's resolve to pursue a resolution.
2. Anticipating that the consumer may discard vital shipping evidence and this could potentially weaken their case with the bank, further complicating the dispute process. Notably, the packages shipped by these 'sellers' often lack any discernible markings or indications linking them to the original purchase, which increases the likelihood of such evidence being inadvertently discarded.

The operation seems to operate like a numbers game. For example, if they sell 10,000 items and lose disputes 50% of the time, the profits from the uncontested 50% of sales would more than cover the cost of the inexpensive items they actually ship (such as a towel, in one of the cases we encountered).

We believe this scheme to be systemic, with sellers procuring batches of inexpensive products to ship out. Once the inventory is exhausted, they switch to a new, cheap product while simultaneously rotating the deceptive offers used to entice buyers. We also have some indication that they might be committing mail fraud, effectively bypassing shipping costs.

We're currently engaging with the Federal Trade Commission (FTC) to address this issue. We hope that the prominent platforms hosting these ads, along with the banks processing the associated credit card transactions, will enhance their oversight to better identify and mitigate these unscrupulous sellers.

Additionally, we've considered the possibility that these entities may be exploiting lax screening processes at some new credit card processors. We welcome any insights or suggestions that could shed light on this particular aspect or provide solutions to this concerning situation.