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Skype refuses refunds on unauthorized calls

By | October 31, 2011, 10:22am PDT

Over the weekend It seems my Skype account was compromised. I only found out today and took immediate steps to resolve the problem by changing passwords etc. But for two days €28.75 was taken from my account using Skype’s auto renewal service. Skype for their part blocked my account temporarily due to unusual behavior which is fair enough. I didn’t know about any of this until I saw today’s emails at around 4pm local time. In part because I didn’t have Skype on (so would have seen the balance and thought ‘Duh?’) and also because I was doing other things.

I get in touch with Skype and ask them about a refund. Not happening. They acknowledge that unauthorized calls were made, they blocked the account and got me back to the service. Which is all good stuff. But unlike other telephony companies and banks where this sort of thing happens, it’s down to you if your account has led to financial loss. That sucks. Imagine if I was a business user with a dozen or more accounts?

Skype has just lost me as a paying customer after seven years of using the service. I’ll use something else.

Here’s the thread:

Roan Cheryl M.
Hello! Welcome to Skype Live Support! My name is Roan. How may I help you?
17:52:17 dahowlett
I have changed my password so hopefully the account will not be compromised. I have also disabled auto credit renewal.
17:53:15 Roan Cheryl M.
I am sorry to hear that a third party was able to access your account.
17:53:35 dahowlett
What can you do about the amounts taken out of my account over the weekend? On 2 days €28.75 was sent. Looking at the call history it seems someone hijacked my account and made calls to Egypt and an Indonesian mobile. You suspended my account for unusual activity which is fine but I never made any of those calls
17:54:22 Roan Cheryl M.
Let me pull up your account so that I can assist you further.
17:54:32 Roan Cheryl M.
May I please have your name and Skype Name?
17:54:53 dahowlett
skype name: dahowlett - number? what’s that please?
17:55:06 dahowlett
sorry - misread: name is Dennis Howlett
17:55:57 Roan Cheryl M.
Thank you for the information, Dennis.
17:57:49 Roan Cheryl M.
May I know where you are currently located?
17:58:18 dahowlett
At my home in Spain
17:59:57 Roan Cheryl M.
May I also have your registered email address, please?
18:00:46 dahowlett
dahowlett@gmail.com
18:01:47 Roan Cheryl M.
Thank you.
18:03:47 Roan Cheryl M.
Your account is now verified and unblocked.
18:05:02 dahowlett
Right, now what about refunding for the amounts lost please?
18:06:33 Roan Cheryl M.
Unfortunately we are not able to refund any money that may have been lost due to this incident.
18:08:01 dahowlett
Why? The account was hijacked. I have no idea how so it isn’t down to me. It happened at a weekend when I would not necessarily notice unusual behavior and remember that auto renewal is done out of trust to Skype
18:09:03 Roan Cheryl M.
Although we have security systems that monitors Skype accounts’ usage. Skype users should maintain their own security systems on private computers.
18:09:41 dahowlett
MY COMPUTERS WERE SWITCHED OFF at the weekend
18:09:48 Roan Cheryl M.
In order to avoid such incidents, Skype strongly advises you to regularly update your PC’s security software - such as firewalls and anti-virus programs - and to pay attention to safeguarding your Skype account.
18:10:03 Roan Cheryl M.
For more information on staying secure, please visit: http://www.skype.com/go/security/
18:10:52 dahowlett
I have been in this industry 40 years, I KNOW about security. You’re simply saying ‘Tough - your problem.’ that’s not good customer service in these very unusual circumstances
18:11:13 dahowlett
That’s OK though - I’ll simply blog it at my ZDNet place - thanks and goodbye
18:11:38 Roan Cheryl M.
I acknowledge that you are not the one who made the calls.
18:12:48 dahowlett
Well - like any other service including Vodafone and all of the banks, I’d expect a refund.
18:13:23 Roan Cheryl M.
However, as mentioned earlier we will be unable to refund the credits used on the unauthorized calls.
18:13:46 dahowlett
Fine. Goodbye - you’ve just lost a paying customer. I’ll use another service.

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Dennis Howlett has been providing comment and analysis on enterprise software since 1991.

Disclosure

Dennis Howlett

Dennis Howlett is committed to maintaining the independent and opinionated stance that his writings are well known for and does not enter into contracts that would limit his freedom of expression in any way. However it is important in the interests of full disclosure to inform readers of those relationships so they can form their own judgment. This page therefore lists all Dennis Howlett’s current business relationships.

Dennis’s consulting arrangements occasionally bring him into direct or indirect business relationships with some of the companies about which he writes, and/or their competitors. Where such a relationship exists, it is disclosed at the end of any article that references the company concerned.

Dennis owns AccMan, an independently produced blog covering the professional services market, primarily focused on Europe. It is currently sponsored by selected TextLink Ads and named sponsors in the ‘Sponsored Content’ block.

He is a member of Enterprise Advocates, a loose association of consultants, and analysts who are concerned with the buyer side of the buy-sell enterprise relationship.

He is a paid contributor to IT Counts, a site dedicated to discussing technology issues as they related to ICAEW members. He also advises ICAEW on certain aspects of its member outreach programs.

He is an SAP Mentor and participates in SAP Mentor webinars. He has recently produced a guide for SAP resellers wishing to record customer videos. Other than as disclosed here, Dennis maintains no business relationship with SAP and is not financially rewarded for his role as a Mentor.

Dennis maintains relationships with a range of end user organizations and in all cases is subject to non-disclosure agreement. He has no current ‘paid for’ relationships with ITC vendors except as disclosed above although certain vendors comp travel and expenses claims. For the benefit of doubt, T&E reimbursement is a common practice among European based writers. It is often the only way we can attend important events. Even so it doesn’t impact our analysis of what vendors have to say. If you believe otherwise then feel free to ignore what is written here.

Except as mentioned above, Dennis has no other investments in any tech industry participants. This page last updated 23rd February, 2010.

Biography

Dennis Howlett

Dennis Howlett has been providing comment and analysis on enterprise software since 1991 in a variety of European trade and professional journals including CFO Magazine, The Economist and Information Week. Today, apart from being a full time blogger on innovation for professional services organisations, he is a founding member of Enterprise Irregulars and an investor in a European start-up. Prior to, Dennis was technology and tax partner in a British firm of Chartered Accountants for 10 years. Prior to that held various senior finance roles across a broad range of industries.

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RE: Skype refuses refunds on unauthorized calls
roddic 29th Nov
Dude just right up a really bad review on skype billing practices based on your experiences and post it in as many places as you can. Hell even make up a small song or hire that guy that had an issue with his guitar in a flight and watch skypes stock values plummet. Any service that offers no service or at least protection for their clients, should be out of service
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Did you use a very strong password with the following requirements?

* Lowercase letters with no vowels
* Uppercase letters with no vowels
* Numbers
* Symbols like !, @, $, etc.
* 8 characters minimum or longer
* No consecutive letters and numbers (like 123, rr, ss...)
@Grayson Peddie Police to homeowner.
Do you have an Iron door with triple pad locks?
Do you have bars on the windows?
Do you own a gun?
A large dog?

Your questions about passwords are absurd - as if its his fault someone hacked his "Hype".
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Actually not
lou@... Updated - 31st Oct
@Bodazapha
It is your fault if you get hacked. -- Full Stop

Do you want Skype (or for that matter any service provider) to ensure you have virus protection, do not use your name as password, the same password for all your various netaccounts or have a sticky with it on your work computer.?

Howlett's words though is priceless - 'The account was hijacked. I have no idea how so it isnt down to me. " and "MY COMPUTERS WERE SWITCHED OFF at the weekend" - lolz - and whoever used your password did not get it earlier?

If somebody wanted to perpetuate fraud - they would have taken more than 28 Euros.

By climbing up the soap box and broadcasting this Dennis is probably saying more about himself than about Skype.
  • Flagged
@lou It is your fault if you get hacked. -- Full Stop

Actually, maybe not.

The financial institution that held information for my debit card was hacked a few years ago. They stole the information from inside, and used it to spend on my debit/credit card. It's not necessarily always the case that the user was hacked.
@Grayson Peddie
"strong" passwords do nothing. In fact they are as secure as extra TSAs at the airport. Its only there to make you think its secure. No length or number of symbols will help you if the hacker bypasses the password security.
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@rengek Lenth of the password matters. do you know bruteforce attack? Shorter passwords are more vulnerable.
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@sandeep.splash You obviously missed the most important sentence in Badered's reply:
"No length or number of symbols will help you if the hacker bypasses the password security."
@sandeep.splash
Length of password or lack thereof doesn't abdicate skypefrom exponentially rate restrict incorrect password guesses. So brute force should only be possible if attacker acquired hashed password table from skype. And if that happened, it is an entirely different problem.
@Grayson Peddie
I'm guessing after 40 years in the business he knows how to suck eggs ...
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RE: Skype refuses refunds on unauthorized calls
kennethepeterson@... 31st Oct
@nigebj ,
I guess it is your beliefthat anyone has a right to steal your login inf , by whatever means available, and go on a spending spree using stolen access info, N'est pas?
A thief is a thief and the providers have a resopnsibility to protect the information of their customers.
I blame this gentleman not! He did exactly what he should have done and closed the account.
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@Grayson Peddie It looks like some people done understand sarcasm..
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@Grayson Peddie, lou@...
even govt installations around the world were known to have been hacked with their 24/7 technical support (not just with one guy but with computer security department, manned by engineers and technician whose technical expertise are beyond our capability), how on earth can we justify that an ordinary user can mitigate attacks against his/her account. and as for lou@, please don't discount the technical expertise of the writer. this thing happen whether we like it or not. as soon as we connect to the internet, we are vulnerable.
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But then what's the readership of ZDNet!

I like the bit about security software. Another windows machine. I'm sure just another coincidence;-)
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@Richard Flude

There are plenty of people that have had their account information phished and stolen on any OS. In fact I am sure the method his information was stolen wasn't dependent on the OS anyway, but you already knew that and are just trying to be the troll that you are.
  • Flagged
@Grayson Peddie
Actually one has to wonder if Skype didn't get hacked directly. My Yahoo accounts were hacked, but so were thousands of others at the same time. My password was upper, lower and numbers. That doesn't help when the vendors systems are compromised exposing tens of thousands of accounts passwords directly to hackers.
@Grayson Peddie

Actually - as amusingly illustrated here , there are much simpler, stronger and easier to remember password-generation algorithms.
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Obviously he was read to from a script. That he never had the audacity to demand a supervisor or call an actual support number is kind of silly.

I'd be climbing up the support chain to the highest supervisor I could contact. Sometimes it requires that.

He gets on the soapbox for no effort at all. Lame.
@Grayson Peddie

Hi.

I think everyone is missing the point. It is not to know if it was his fault if he was hijacked, but it is about Skype's policy in response to it.
Any company will have some protection built in for such a case....
Any phone company, credit card company, anyone doing business with customers, especially online.
even PayPal and Ebay have some protection policy on fraudulent usage of their services.

The problem is that Skype, although bought by a Fortune 500 is still a European (UK) company where that usage of a refund for fraudulent use of your account if still not in the customs....
Doesn't matter how he formulated his password, if there were unauthorized charges, he should be able to report the problem and have it taken care of. From the sound of it, he didn't use a credit card to pay the bill, or he could easily get that charge disputed. This is why I no longer use paypal to pay Skype.
@teetee1970
I don't think it was Paypal:

..."???28.75 was taken from my account using Skype???s auto renewal service."
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Gotta agree with Dennis. Skype should, as a responsible business, refund his $50 (ball park) and keep him as a customer. Since they didn't, they have lost him as a customer. Since he has a soapbox, others will be privvy to the story. The moral is businesses should empower their customer service people to help more on things like this, rather than keeping the $50 and losing the customer. I don't believe it's a legal issue in the sense that he can't sue Skype for not refunding his money, but they will likely lose more money over this issue than the $50 he wanted refunded.
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@swmace Dennis is also a naive 40 years IT guru - auto renewal is a bad - or shall I say BAD IDEA - you have no control over your account then. And I guess he wont be trusting service providers with open access to his credit card again.
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The terms of service specifically state it is the user's responsibility and it takes no responsibility for unauthorized use of your account.

http://www.skype.com/intl/en-us/legal/terms/tou/#obligations

They are NOT a credit card or some other financial institution that has some government or other financial backing to support unauthorized access to refund your money. If credit cards or banks didn't have these rules, regulations and laws to make them do such things they would not help you out either.

It sucks to what happened to you but chances are you had a weak password or fell for some malware or phishing scam and gave your account info away.

Better check the TOS of that "something else" you are going to use because I would bet they have the same terms. They are NOT in control of the money so they have no legal obligation to do anything about it and frankly there is probably not much they can do. Your best bet is to prove the charge was fraudulent at pay pal or the credit card that supplied the funds. After all you don't go after Walmart because some thief used your credit card to buy something there do you? No you go after the credit card company or bank that supplied the funds.
@bobiroc
TOS are one thing, losing a customer over a small amount of money is quite another. Customers are expensive to come by - just look how much money Skype has been bought and sold for ... so wasting a good customer, who happens to have a good soapbox, for small dollars is just short-sighted.
@nigebj not short sighted. they are following their own rules (Skype). I had an issue with them years ago and dropped my paid account. Now a free account and hardly use it. Ever think of going VOIP?
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@bobiroc
And what if thats not the case? What if the compromise was on the server side? Not like skype would ever admit to it nor launch an immediate investigation on your behalf. Maybe they'll acknowledge it a year from now. But do you think they will retroactively credit the user if that was the case? Doubtful unless some regulatory agency got involved. Companies will do nothing for you until they are threatened to do so.

I had a similar battle with a cable company once many years ago. pay per view charges showed up on my bill. They insisted that the charges came from my home. I told them I was on vacation when those charges were made so unless my cat dialed in (long story short my pay per view at that time could only be authorized by phone with a live person and with a specific credit card and a voice password) and ordered wet tshirts part 2 I seriously doubt it came from my home. They said their system is geared towards 100% accuracy and it could not be their fault. So they refused to credit me until I sent some letters to the state attorney general's office and they made the cable company refund the charges after launching an investigation on their sorry behinds.
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@rengek

This same exact thing happen to me with FIOS. I ended up contacting the CEO's office and they refunded the $60 for a fight PPV. We were home that night, but we didn't order it, nor have I ever bought any PPV.

The woman who called to tell me I was getting a refund said they would turn off my ability to order PPV. I said to her "What about the concept that I've never ordered a PPV don't you understand?"

I really like FIOS, but I can testify their systems are not perfect.
@rengek

If the compromise was on the server side that is a bit different, however I would think it would be more than a few people compromised. That being said even with the Sony attacks customers had to go to their banks and creditors that issued the cards to dispute the claims and they fought Sony. Of course since that was a widespread attack Sony compensated the victims with free games.

This does not appear to be the case here and I welcome Dennis to prove that it was on the server side. If he can do that then I will gladly support his claims that Skype should do at least something.

Your example is a bit different because you were able to prove that you were at no fault but Dennis cannot. Either his Skype got compromised or his method of payment did probably due to some malware or phishing attempt based on the information he provided.
@bobiroc I am a little surprised he left in his actual email address in the blog. With that and some searching on the Internet someone could answer the security questions for other services and reset the account password. In that case your password complexity doesn't matter.

Even so, good customer service practices would allow for a refund of such a small amount, especially given his length of commitment to their service..

Bob Farrell - "Give Em The Pickle!"
@bobiroc - You make an excellant point. Most good credit cards have protection against consumer fraud. Call your credit card company and tell them that the charges were not made by you and then let them fight it out with Skype. You're much more likely to get satisfaction in this way.
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RE: Skype refuses refunds on unauthorized calls
ScorpioBlue Updated - 6th Nov
@bobiroc

That's because Microsoft now owns Skype. Funny how this only now becomes an issue where it wasn't before.

They're gonna pull a Verizon or an AT&T and nickle & dime you to death.
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I stopped using Skype a long time ago because every service I loved, changed every year to something worse, after the 3rd year I said screw, Skype isn't worth it. Learning this makes me glad I am no longer a Skype user.
We have had unauthorized use of VOIP PBX a couple times worldwide over the years. In no case did a telco ever refund us for any of the unauthorized usage. I'd bet that pretty much any telco will do the same thing Skype did here. I'm sure they would be happy to refund something if it was an internal cost, but they have to pay their third party suppliers, so they are on the hook for the cost of the calls, unauthorized or not.
@khammo01

Are you referring to american or european companies? So it sounds like european companies don't reverse fraud. In the us, I have twice been refunded fraud or misrepresented third party charges on telco bills, including by tmobile.
what you thought that meant? Only on weekdays? Only when your computer was on? It seems pretty plain what unauthorized calls means, someone you havent agreed to let use your account uses it. You agreed to take responsibility for that did you not? Are you suggesting that someone got into your account through no fault of your own? And that regardless that that somehow voids the responsibility you agreed to? Personally I'm surprised Skype didnt refund you if you area valuable customer. But I don't think you should get bent out of shape over them holding you to your agreement. Good luck finding someone who will be better, you might find next time you're on the hook and your acct wouldnt have been suspended before it's for a much larger amount.
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Same problem
gouvernor 31st Oct
I had the same problem last week for about $50. They took the same stance.
@gouvernor Me too. It's irritating. And it is certainly not the response of a service that wants to be taken as seriously as the telephony companies. Lately, I've been boycotting and just using FB Video Chat rounds instead (http://apps.facebook.com/chatrounds/?publisherid=elena&campaignid=BC&bannerid=0 ).
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I'm in line with Dennis. ANY service company should stand behind a good paying customer when these types of occurances happen. This is a minute amount when dealing with an apparently long term customer. Skype may not be backed by any government agency, it's backed by its paying customers, and they just lost a good customer that has the ability to share their malfortune to the rest of the world, or at least the zdnet readers. Dennis - I'm behind you 100%!
@groundzero2010

I with you too.
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Unless Skype was hacked and that was where to breach was, I agree with Skype. They could have done a goodwill gesture to do the refund. Saying"The account was hijacked. I have no idea how so it isn???t down to me" doesn't justify Skype refundeing you.
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Would serve MS/Skype well if lot's of people would complain. Why should anyone of us get screwed? Why always the little guy? I hear the whisper of Netflix. Shhhhh.
I had this problem a few months ago - skype account hijacked and over ??100 spent over a weekend by someone calling Indonesia. Skype had the same reaction as Dennis got - but I challenged the top-up transactions through PayPal and got my money back ...
AndyK
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My immediate reaction is that you are being unreasonable. How can Skype know that you didn't make the calls. Maybe not you but, say, someone you authorized. Maybe you took a sleep walk and called people.

This is no different to any other credit facility. Can you prove beyond reasonable doubt to an impartial 3rd party that you or someone you authorized didn't make the calls. If so prove it. If not move on. Why should any organization you are upstanding to a fault, never make a mistake. Your attempt to claim pushes the price up for everyone else.
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sour lemmons
simorjay 31st Oct
I agree that this is a poor business choice on Skype???s part but honestly strong passwords work.. if you actually use them.

My beef is giving Dennis soap box like CNET to publish this kind of discussion without real journalism is wrong. Where is the editorial process.

So we see an IM discussion with a dial in tech. Did Denis ever ask for a manager? Maybe filing a real complaint? Blows my mind that this 20 minute chat is considered a quality Journalism. Dennis do a follow up before you use the power of a soap box to vent. I???m going to join you??? ZNET you have lost me as a customer for the poor editorial you do.
@simorjay

Strong passwords don't help if the hacker got the skype password hash file from skype.

I appreciate Dennis was able to publish this piece. I didn't realize this was skypes position. I thought European consumer protection laws were better than this. I'll be sure to never become a skype customer, paid or free.
I don't care whose fault it is, if the providing company refuses to reimburse fraudulent charges to your account, I don't need them.. Just cancelled my Skype account of many years.. don't need the hassle..
You state that accounts are refunded by other telephony companies. Did you read the article in the NY Times business section (The haggler column) this weekend about the person who had his cell phone stolen in South Africa and was on the hook for $250.
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It's not about passwords. It's about what good customer service looks like.
Successful companies have "Bend over," policies, and do so knowing that there will be some that abuse the policy. When a customer has a seven year old account, it should trigger an agressive retention policy the quickly forgives questionable charges.
I'm sure you've hear it said that a happy customer might tell one or two people, but a disatisfied customer will tell twenty.
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i think i wont be signing up for their service
Dude just right up a really bad review on skype billing practices based on your experiences and post it in as many places as you can. Hell even make up a small song or hire that guy that had an issue with his guitar in a flight and watch skypes stock values plummet. Any service that offers no service or at least protection for their clients, should be out of service

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