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Plastc Swiped $9 Million From Backers, Now It Plans To File For Bankruptcy and Shut Down (theverge.com)
Plastc announced today that it is planning to file for bankruptcy and will shut down on April 20, 2017, after raising more than $9 million through preorders and shipping to no backers. "Plastc launched in 2014 with the promise of shipping a single card that could digitally hold 20 credit or debit cards that a user could switch between," reports The Verge. From the report: With that, all backers' money is lost, and no Plastc cards will ship. Plastc announced the news on its website today along with the fact that all its employees have been laid off. Its customer care and social media channels have also been shut down. The company explains that it thought it would close $3.5 million in funding in February this year, but that fell through. Another possible investment deal of $6.75 million fell through, too. What's not clear is how more than $9 million wasn't sufficient to get backers their orders. Backers will likely have questions and want their money back, but with no one to turn to from Plastc, they'll likely be out the cash.
If one were to look at the long term history of the financial industry (going back to before wall street was wall street), you'd find bankers, stock brokers et al were inherently distrusted. Financial fraud is/was easy so they did it... Over and over and over.
This is why there has historically been heavy regulation and oversight.
Welcome to America. We don't have chip and pin, we have chip and sign, but actually, fuck signing most of the time.
The chip does NOTHING in the USA except make the whole process take longer. Cloners have been available in the US for these cards for years. And you can still run the, as mag swipe (or even phone-in/ "offline" transactions) at a whole bunch of exempted places that don't have to get their act together anytime soon.
The three types of suckers are investors, clients and workers. The most profitable form is to steal from all three and keep the fraud rolling along indefinitely. That is the fundamental model for the financial industry. All the top banks, investment houses, hedge funds, etc skim the wealth generated in the country and put it in their own pockets. That's, along with regressive taxes, underlies the ever increasing wealth disparity between rich and poor.
So what do you think will happen to the scam artists who pulled this off? Will they suffer any economic or reputational damage? No way. They all got out fat and happy, and their business reputation will be enhanced because of their successful raid on a gullible public. I expect they will get better positions with larger companies because of their proven track record of theft.
I expect no change, although it might get worse. I just wish they would stop calling it capitalism.
Why is Snark Required?
AFAIK In Europe connection generally IS made to the banks (on occasion this can be slow, or fail and need to be retried, which have both happened to me), but provision is made for disconnected terminals. For your hypothetical attack people would need to find unconnected POS terminals, which are pretty uncommon now. Contactless is another matter, but there is a low transaction limit.
To be fair, /. got the story up within 24 hours, which is actually faster than average for them.
The company didn't announce their shutdown in advance, so nobody could have reported it before yesterday afternoon when the message went up on the site and all their social media shut down.