According to an article in Business Insider, Sharron Laverne Parrish, Jr. scammed Apple 42 times with a very simple scam. He presented debit cards on closed accounts for purchases – apparently in the thousands of dollars each. When the card was declined, he offered to call his bank and handle it. Except he was not talking to his bank.
At the end of the conversation, he would give the Apple employee an override code and take his purchases. This worked at Apple stores in 16 states, which would indicate they may have a process or training issue.
Since the store opted to override the decline, the store is on the hook for the fraud, not the bank. He did this to twice to some stores. To the tune of over $300,000 !
Apparently, as long as the syntax of the authorization code is correct, no validation is performed on the code. How’s that for smart?
He’s not the first person to do this. The article talks about another person who did a similar thing to Victoria’s Secret, Banana Republic and others to the tune of $550,000 !
Moral of the story – make sure employees are well trained and up to date on the current scams.