DoNotPay's new service auto-cancels free trials
wired.com
wired.com
Unfortunately, you can't even get into the app without providing your phone number and then entering your banking information.
Nope, not happening.
It's not that I don't trust the kid making this app. I mean, I shouldn't trust him, but that's not even the issue. He is using a personal developer account, doesn't seem to have a proper company, is involving third parties for app functionality (including the banking info).
Even with the best of intentions, he's likely to get hacked or bought out, or his third party SDKs are, and there's no way to protect yourself from that.
You would have to be seriously foolish to type your bank username and password into this thing.
Maybe someone can make a virtual bank app, so you can sign up for virtual credit card apps...
They sell it off to a collections company, often for $50 or more. That company adds fees, interest, and charges to the bill ($50 for each letter, etc), and finally takes you to court when the amount owed gets to $3000 or so.
The court can't chuck out those extra charges, since they can be seen as a legitimate consequential expense.
The gym memberships could be different if the contract is setup to give you your first month free when you sign up for six. But even then most give you some guarantee such as "if you're not satisfied". I think your point is that this type of service creates a cat and mouse game with which there is only a temporary winner.
What I do like about this new "trend" is the abstraction of the end user. Netflix doesn't need to know who I am. If I pay I should be able to consume service. I realize this opens the door to more potential fraud for them, but the reality is the people commiting that fraud today are already using fake names, addresses and email. And if services don't have real information and single use card information when they get breached the value of each record is significantly less. So at the end of the day the inconsequential side effect seems to be a win from a breach cost standpoint.
If it was card to card, they'd be eating credit card costs... they currently profit from your usage (interchange fees)
like credit card processing the bank connection is something you want to be done via third parties. it would be a much bigger deal if he was intercepting bank logins and scraping.
I can see putting in a real credit card for a subscription fee of some kind, but there is no way I'd give out bank info when the entire point of the app is to do exactly the opposite.
To be clear you have to trust plaid, and you have verify that the web app is actually using an iframe and not just faking the plaid interface. But you are not just trusting a random web app with your banking credentials.
That’s not how it works. Just because they can’t bill your card does not mean you’re not on the hook. Anybody that’s forgotten about a gym membership on a expired card knows this first hand. Only reason they won’t go after you is that the LTV and PR isn’t worth it. If it is, they will.
> As he sees it, companies that require you to put in a credit card in order to sign up for a free trial are engaging in deceptive practices.
There’s nothing deceptive about it if the price is disclosed. Far from it. On the sell side it also has the advantage of filtering out people who cannot or would not pay for the service early on.
> After your free trial, Amazon Prime is just CDN$ 79.00/year (plus any applicable taxes). Cancel anytime. Quebec residents receive an initial 13-month membership for CDN$ 79.00, instead of a free trial.
For an actual annual membership, that's a whole other matters and I'm pretty sure that service won't support that, though the gym membership example could be a bit deceptive (there is some prepaid gym membership though, so that's not entirely deceptive).
They also allow that:
> If you want, the app will also send an actual legal notice of cancelation to the service.
What you’re saying makes little sense for most “free trial” offers. These offers do not come with a term agreement (ie they are cancel anytime), and furthermore they are prepay. Ie you are offered a trial period and then you are billed in advance for the continuing service. So without a term agreement and prepay you’re not on the hook for anything. You just never paid, they terminate your service and that’s it.
if (chargeamount>0){ decline()}
This unit tests both the debit (of e.g. $.01) and a credit of the same amount against the target. They can also vary the amount, then ask the recipient to report the amount posted (so you can prevent additional fraud that way - attacker may have your bank account/routing details but no login to your statement/transaction listing).
It was definitely processed through the MC network, and not via Direct Debit (the closest UK equivalent to pulling funds via ACH).
I know this because the vendor didnt have my bank account number, because Direct Debits are processed in batch (not instantly), and because the app associated with the account showed it as a card transaction.
If the card approves the pre-auth, they are (presumably, AFAIK) on the hook for that $1 if the merchant captures the pre-auth. If many (unpaying?) users start charging you $1...
Merchants on the blacklist have all charges denied.
Any 'free trial' who actually captures a dollar from their clients will cause lots of chargebacks from their customers, so would go out of business quickly... (A chargeback costs a business ~$15 in fees)
- if less than 0.05, approve (as no merchant would actually charge a transaction for that amount, as they'd spend more than 5 cents on fees)
- if more than 5 cents but less than 1 USD, approve it only if the merchant is already known to offer free trials
You could be fancier:
- match on amount+merchantID combo, not just merchantID
- learn a model to deal with previously-unseen merchants
In this scheme it is DoNotPay accepting the liability (and declining the payment). It might then become economic for a big free trial operator to sue DoNotPay for all the declined payments.
But I'm not a lawyer. Good luck to them anyway.
I think it's a public service to tell young people how gyms work. Basically it's high pressure sales ("this discount membership offer only good for today!") plus hard to cancel memberships.
Gyms work on a model of human nature + oversubscription.
Human nature means that a huge % of people join the gym, go two weeks, and never return. Then it's hard to cancel, so the same people that don't bother coming in, don't bother figuring out the membership cancellation gauntlet.
They charge a day fee or a monthly fee or you can pay for 3, 6 or 12 months.
I've never given then any credit card or bank details as I pay cash, but I believe they do offer direct debit.
I've tried signing up for gym twice, first time, I gave in to their pressure sales pitch (yeah I was naive) but canceled the contract under WA's RCW 19.142.040 (I have three days to cancel it for any reasons) , second time I walked away after getting tired of pressure sales. They particularly shame you for out of shape, etc, too.
This pretty much this sums up why I absolutely dislike these style of sales...
That seems like it should be explicitly illegal. I suspect it is already technically illegal in many jurisdictions. In the UK I'm pretty sure this would be considered an unfair contract term.
ACH / Direct Debit payments are much cheaper for the merchant to have rejected. Typically $0.25 or less.
"If you want, the app will also send an actual legal notice of cancelation to the service."
Check if your bank offers this kind of service. Mine does, and it's very convenient!
> If you want, the app will also send an actual legal notice of cancelation to the service.
Hmm this needs explanation. Why's he a wunderkind? What did he do? I googled him and found his wikipedia explaining that he created DoNotPay. Is that enough to justify a wikipedia entry or is it because of the forbes 30 under 30 thing? Can I create a wikipedia page about myself for the apps I created?
doesn't hurt that he basically has unlimited funds from his dad
I can't remember which right now, but I know I've seen the error message a few times.
In a sense, it is your credit card limit is basically your credit card company saying "yeah, this person is good for x amount of money". That isn't much for a prepaid card.
Edit:
An interesting answer elsewhere in the thread: https://news.ycombinator.com/item?id=20465459
Unfortunately it also defeats the legit purposes too.
Does anyone know if legally you're on the hook for the paying the service provider? As technically they did provide the service, and you're "refusing" to pay for it. Presumably, if so, they could send the bill to collections and put a black mark on your credit.
I think XYZ Startup won't do that because they would rather let it go for now in hopes that you'll become a paying customer again.
Your cable company gives you service you pay for that service a month later.
For subscriptions I don't intend to use past the free trial, I just enter a low limit (e.g. $1) and set as a burner card.
They need to give people a way to make that information easily exportable, so that I can combine this with other information from my credit cards, debit cards, and all other financial transactions.
One, your bank doesn't show the full ACH details. This is what it looks like for me at my credit union: ACH Debit PINBOARD - PRIVACYCOM - 7/12/2019 - $25
Two, maybe you enabled the "private payments" setting on your account, which omits the merchant data?
Is there really money to be made building services to automate things that don't remotely need automating? Maybe I should jump on it.
Then you can say "Hi Bob from Zipcar, Fred from XM radio, and Kate from FitGym, I'd like to cancel all your services."
If one puts you on hold, you talk over the hold music to speak to the other ones on the call.
Gets the job done much quicker typically.
Same for "press 1 for ..." type menus.
Sometimes the automated system says embarrassing things like "The balance of your account is..."
Last time I tried something similar (unroll.me), I paid in privacy.
I lived below the poverty line in college (didn't have loan/grant money; instead I worked 2 days/wk to pay for tuition, rent, gas, and food). The kinds of services they offer would have been so helpful to me back then.
Anyway, I find this easy and effective (free too, if you already own a phone):
When I sign up, I tell my phone to remind me to review on such-and-such a date (or "in 29 days" or whatever).
This "wunderkind coder and entrepreneur" is son of Bill Browder, wanted in Russia for tax fraud [0].
I realise that most HN readers (and the entire western mainstream media) are sympathetic to Browder senior, no doubt due to his personal war with Putin.
Indeed it's difficult to find any detailed criticism of Browder, however if you are interested, here are a few [1], [2].
The docco "The Magnitsky Act. Behind the Scenes" is especially interesting. During it's creation, the film-maker Andrey Nekrasov went from being anti-Putin and believing Browder, to being threatened with libel suits by Browder.
[0] https://www.reuters.com/article/us-russia-browder/russia-ask...
[1] https://www.thekomisarscoop.com/?s=browder
[2] https://en.wikipedia.org/wiki/The_Magnitsky_Act_%E2%80%93_Be...
So you can actually pay for a while, then block them.
You can set custom expiration dates, which is nice if you have a future transaction, but want to make sure they don't bill after that.
Even better each merchant gets a different CC number, so you have a much lower chance of your number being stolen.
I'll typically make a 1 year card with a high limit for each online merchant. If it's a one off, I'll make a 1 month card with a dollar limit of exactly the transaction amount.
You need to get a credit card with Bank of America. As best I can tell they are the only ones who offer it.
Make sure you are able to run flash, since the tool for generating the numbers uses flash. Look for "ShopSafe" on their website once you login to your account.
It does exist. For a long time under hbo Canada now under the crave brand.
It sounds like adblock. Sounds great until you consider youre defunding things you want to exist (for free)...
Basically ensures it CAN charge the card but then doesnt
Pre-authorization times out after 5 days. The merchant does pre-authoriziation first for a small amount (like one dollar) just to make sure the payment is actually valid, which disappears after 5 days with no capture. It's just a card validation method, it doesn't reserve any funds (besides the single dollar). Consumers would be rightly upset if starting a free trial with no obligation immediately reduced their available funds by a significant amount. This is unrelated to the later charge when the trial ends, which is usually more than 5 days later, and will be a distinct charge for the full amount.
There isn't anything unethical about automatically declining purchases. It's not any different, cost-wise, from manually cancelling the trial. The merchant could however continue to provide the service, claiming that you never really cancelled it, then consider you indebted for the declined charges, but that wouldn't go over very well.
They do that on the basis that if you don't have funds to cover 3 months service, they probably don't want you as a customer. Any service with upfront costs (eg. Sending out hardware) is likely to do this.
The Free Trial Card is a virtual credit card you can use to sign up for free trials of any service anonymously, instead of using your real credit card. When the free trial period ends, the card automatically declines to be charged, thus ending your free trial.