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Beware of a new kind of fraud

13

Comments

  • jsgjsg Member, Resident Benchmarker

    @raindog308 said:

    @maxxxxx said: Because even assuming you won the world championship because you're very fast at changing your password; by that time your server is already compromised.

    Oh bullshit.

    In 20-odd years of using VPSes, I've never once had a VPS compromised by someone grabbing a plain text out of my email. Even when I've ordered one and not come back to set it up for months. Sending passwords by email is extremely common.

    I'm not saying it's a good practice. I agree with @MannDude that users providing SSH keys is definitely the way to go and I do that whenever possible, but the idea that everyone's systems are being compromised within seconds of a password being emailed is nonsense.

    Very similar here. While I do trust @yoursunny telling the truth I think that was a very unlucky exception.

  • CheepCluckCheepCluck Member
    edited July 2025

    @raindog308 said:
    I'm not saying it's a good practice. I agree with @MannDude that users providing SSH keys is definitely the way to go and I do that whenever possible, but the idea that everyone's systems are being compromised within seconds of a password being emailed is nonsense.

    How would you feel if a host provided you a password in cleartext from the top 100 dictionary words on a publicly accessible ftp server?

  • raindog308raindog308 Administrator, Veteran

    @CheepCluck said: How would you feel if a host provided you a password in cleartext from the top 100 dictionary words on a publicly accessible ftp server?

    Who is still using FTP in 2025?

    That protocol was obsolete already in the 20th century.

  • defaultdefault Veteran
    edited July 2025

    @raindog308 said:

    @CheepCluck said: How would you feel if a host provided you a password in cleartext from the top 100 dictionary words on a publicly accessible ftp server?

    Who is still using FTP in 2025?

    That protocol was obsolete already in the 20th century.

    But you did not answer the question. The subject of question was about password.

    Meanwhile: yes, FTP is still heavily used in 2025! Look at cPanel or DirectAdmin using FTP accounts to upload files.

  • raindog308raindog308 Administrator, Veteran

    @default said: But you did not answer the question. The subject of question was about password.

    I've never had a provider provide me a password via a publicly accessible FTP server.

    I mean, c'mon...most providers are using something like Solus which is generating the passwords.

  • NoctNoct Member

    @raindog308 said:

    @maxxxxx said: Because even assuming you won the world championship because you're very fast at changing your password; by that time your server is already compromised.

    Oh bullshit.

    In 20-odd years of using VPSes, I've never once had a VPS compromised by someone grabbing a plain text out of my email. Even when I've ordered one and not come back to set it up for months. Sending passwords by email is extremely common.

    I'm not saying it's a good practice. I agree with @MannDude that users providing SSH keys is definitely the way to go and I do that whenever possible, but the idea that everyone's systems are being compromised within seconds of a password being emailed is nonsense.

    Respectfully -- because I enjoy reading your posts, generally -- I'd like to point out that the idea that nobody's systems are being compromised withing seconds because of a password being emailed since there is an example of just one person and just over the span of that one person's 20-odd years of experience is equally nonsense. o:)

  • raindog308raindog308 Administrator, Veteran

    @Noct said:
    Respectfully -- because I enjoy reading your posts, generally -- I'd like to point out that the idea that nobody's systems are being compromised withing seconds because of a password being emailed since there is an example of just one person and just over the span of that one person's 20-odd years of experience is equally nonsense. o:)

    Which is why I didn't argue that.

    I was disagreeing with the assertion that it's common.

    @raindog308 said: the idea that everyone's systems are being compromised within seconds of a password being emailed is nonsense.

    Of course it's possible and I'm sure it's happened.

    Though now that I think about it, this whole "plain text email" thing is a bit overstated.

    For example, I host my email on Gmail. The provider's SMTP connection to Gmail is encrypted because Gmail requires that. My connection to Gmail to retrieve the email is also encrypted.

    So in my case - and I think I'm fairly representative here - there is no "plain text in transit" risk. The only time that password is in an unencrypted form is when the email is prepare on the provider's server, while it's sitting on Google's server, and when it's displayed in my web browser.

  • @maxxxxx said:

    @barbaros said:

    @maxxxxx said:

    @barbaros said:
    Can someone please explain what's wrong with sharing passwords in email in clear text? Are you that regarded to not change the password you got in the email?

    Because even assuming you won the world championship because you're very fast at changing your password; by that time your server is already compromised.

    How? That is only possible if there is any MITM attack. And if they can do it, they can simply change your password and reach your server from your hosting's panel.

    Every email can pass through a dozen or even more hops/servers/systems. There's no guarantee for all of them to be encrypted in transit or at rest. Every system the email goes through increases the risks substantially; risks of there being a rogue employee or one of those system already being hacked, etc.

    @yoursunny already mentioned it happening in practice. But if the hackers are a bit more smarter and sofisticated they will compromise your system without triggering abuse notices and just sit there without you having a clue about it.

    @yoursunny said:
    Next time send VPS password by Priority Mail.
    You then have a tracking number to supply PayPal.

    It is actually explained on PayPal website how to prove the delivery of intangible goods:

    For intangible or digital goods, proof of shipment or delivery means compelling evidence to show the item was delivered or the purchase order was fulfilled. Compelling evidence could include a system of record showing the date the item was sent and that it was either:

    • Electronically sent to the recipient, including the recipient’s address (email, IP, etc.), where applicable; or
    • Received or accessed by the recipient

    Just a matter of setting up your system to be able to provide such evidence.

    The evidence of delivery is the claim. Nothing simpler than that. PayPal should deny it on catch 22 or common sense.

    The password being delivered doesn't change fit, form or function nor was expressly stated beforehand. It wasn't the password to the control panel to reinstall the server nor was he prevented from changing any password as he saw fit.

    A missing car engine does affect the function and clearly not an apt comparison (hard eyeroll)

    Why is this even being argued?

    Thanked by 1SmokyHosts
  • TimboJonesTimboJones Member
    edited July 2025

    @raindog308 said:
    Though now that I think about it, this whole "plain text email" thing is a bit overstated.

    For example, I host my email on Gmail. The provider's SMTP connection to Gmail is encrypted because Gmail requires that. My connection to Gmail to retrieve the email is also encrypted.

    So in my case - and I think I'm fairly representative here - there is no "plain text in transit" risk. The only time that password is in an unencrypted form is when the email is prepare on the provider's server, while it's sitting on Google's server, and when it's displayed in my web browser.

    The provider's panel could be sending the email to Gmail over an unencrypted connection.

    https://support.google.com/mail/answer/6330403?hl=en

    I don't recall seeing this red lock, so either it's very uncommon these days or I'm just not looking for it.

    Thanked by 2raindog308 tentor
  • DediRockDediRock Member, Patron Provider

    @zed said:

    @CloudHopper said: Right of withdrawal: a 14-day cooling-off period

    Interesting plot twist, so essentially no provider can declare "no refunds" when dealing with a citizen of the EU. How is this enforceable though? Also, I'm moving to the EU hugs.

    right, how does PayPal, VISA etc view that?

    Thanked by 1CheepCluck
  • NeoonNeoon Community Contributor, Veteran

    Thanked by 2CheepCluck zed
  • NoctNoct Member
    edited July 2025

    @raindog308 said:

    Which is why I didn't argue that.

    I was disagreeing with the assertion that it's common.

    Strictly speaking, this is true. It was the implication that I picked up and ran with because, I suppose, I, too, am susceptible to the hyperbole which abounds on this thread. We can certainly agree that @maxxxxx's hyperbole was the most hyperbolic.

    Just to rattle you:

    @raindog308 said:

    In 20-odd years of using VPSes, I've never once had a VPS compromised by someone grabbing a plain text out of my email.

    @raindog308 said:

    In 20-odd years of using VPSes, I've never once discovered a VPS compromised by someone grabbing a plain text out of my email.

  • SmokyHostsSmokyHosts Member, Patron Provider

    @kuroit said:

    @CloudHopper said:

    @SmokyHosts said:

    @CloudHopper said:
    What happens if you just give the customer the refund and immediately cancel the VPS? Wouldn't that count as a refund rather than fraud, or have I misunderstood something?

    The point being that as per the promotional offer rules, we had already clearly mentioned that we do not offer trials or refunds.

    If it would have been a non-promotional offer, we would have even considered refunding at the first sense of such fraud, as its better to let go off such customers than bear them in the long run.

    In the European Union, customers automatically get a 14 day "cooling off period" where they are free to cancel contracts for digital services and request a refund "without justification". This applies to EU citizens, regardless of the location of the provider, similar to GDPR requirements.

    Source: https://europa.eu/youreurope/citizens/consumers/shopping/guarantees-returns/index_en.htm

    Right of withdrawal: a 14-day cooling-off period

    "If you buy a product or service online, by phone or from a seller at your doorstep (in legal terms a “distance contract” or “off-premises contract”) you have the right to withdraw. This means you can cancel the contract within 14 days without providing any justification (the "cooling-off period"). For goods this means 14 days from the date of delivery, for services 14 days after the day the contract was agreed. If the cooling-off period expires on a non-working day, your deadline is extended until the next working day."

    A client from UK sent us legal notice about a year ago stating that exact clause after us winning the dispute with American Express CC as we have only 3 days refund policy. We still won, and never refunded anything.

    This is right below the "Right of withdrawal: a 14-day cooling-off period":

    Exceptions
    Please note: the 14-day cooling-off period does not apply to:

    plane and train tickets, as well as concert tickets, hotel bookings, car rental reservations and catering services for specific dates
    perishable goods that expire rapidly, such as food or drinks with a short “use by” date
    goods made to order or clearly personalised – such as a tailor-made suit
    goods or services with fluctuating prices following global markets, such as household heating fuel
    fully delivered services, such as cleaning a terrace, if you expressly agreed to start immediately acknowledging you would lose the right of withdrawal
    sealed audio, video or computer software, such as DVDs, that you have unsealed
    online digital content, such as a song or movie, that you started downloading or streaming after you expressly agreed to lose your right of withdrawal by starting the performance
    urgent repairs and maintenance contracts, such as inviting a plumber to repair a leaking shower

    ^ It all depends on how you represent your side of the case. :)
    Dont use any emotional speech with any payment processor or financial institutions, just spit facts and they will most likely lick lol.

    Thanks for the detailed insigts. However, even in this case, we'll have to take the dispute to court or to a third party forum like BBB, coz PayPal simply closes the case and refunds the money. You don't even get a chance to reply to their concluding statements after first time when the case is opened.

  • SmokyHostsSmokyHosts Member, Patron Provider
    edited July 2025

    @maxxxxx said: It is actually explained on PayPal website how to prove the delivery of intangible goods:

    For intangible or digital goods, proof of shipment or delivery means compelling evidence to show the item was delivered or the purchase order was fulfilled. Compelling evidence could include a system of record showing the date the item was sent and that it was either:

    Electronically sent to the recipient, including the recipient’s address (email, IP, etc.), where applicable; or
    Received or accessed by the recipient
    Just a matter of setting up your system to be able to provide such evidence.

    Been some time when last PayPal read through all the proof's submitted deligently, and if required asked for more. Now all they do is don't treat email delivery as a legitimate traceable delivery and give a canned response saying that the proofs you submitted for delivering your goods could not be validated and so you lost the dispute.

    Thanked by 1JohnnySac
  • raindog308raindog308 Administrator, Veteran

    @TimboJones said: The provider's panel could be sending the email to Gmail over an unencrypted connection.

    I thought Gmail required encrypted SMTP? i.e, you had to STARTTLS.

    Admittedly, I just googled it.

    Of course, that's Gmail and any given user could be using a mail server that doesn't require it.

  • NoctNoct Member

    @SmokyHosts said:
    ...we'll have to take the dispute to court...

    Damn, could you possibly get any more small time? :D :D :D :D :D

  • jure12jure12 Member

    @SmokyHosts said:
    The customer will purchase a VPS/server from you and when you deploy the VPS/server and share the access details, they simply claim a refund saying that the access details were shared in plain text (mind it, its the access details of the VPS/server that were shared in plain text, while WHMCS by default hashes their WHMCS login passwords as per GDPR rules). If they had any sense, all they had to do was to change their VPS/server password and never share it with the host again!

    To make things worst, if you don't offer refund, they raise it to PayPal saying the product wasn't delivered, and no matter how much proof you share with PayPal, they simply say that they "advice" to deliver items by trackable courier companies, without even recognizing that it is a digital delivery and not a physical one!

    If anybody wants to know the full details of such a client, to be on the safe side, feel free to PM me. I will share the details of one such customer if you are a patron provider here.

    I don't understand where the scam is here?
    They ask for money from paypal and get it and you take their VPS.
    They don't get their VPS in the end.

  • SmokyHostsSmokyHosts Member, Patron Provider

    @jure12 said:

    @SmokyHosts said:
    The customer will purchase a VPS/server from you and when you deploy the VPS/server and share the access details, they simply claim a refund saying that the access details were shared in plain text (mind it, its the access details of the VPS/server that were shared in plain text, while WHMCS by default hashes their WHMCS login passwords as per GDPR rules). If they had any sense, all they had to do was to change their VPS/server password and never share it with the host again!

    To make things worst, if you don't offer refund, they raise it to PayPal saying the product wasn't delivered, and no matter how much proof you share with PayPal, they simply say that they "advice" to deliver items by trackable courier companies, without even recognizing that it is a digital delivery and not a physical one!

    If anybody wants to know the full details of such a client, to be on the safe side, feel free to PM me. I will share the details of one such customer if you are a patron provider here.

    I don't understand where the scam is here?
    They ask for money from paypal and get it and you take their VPS.
    They don't get their VPS in the end.

    @SmokyHosts said: To explain the fraud part... Promotional offers are offered keeping some calculations in mind. Every business is here to run sustainably and not to give away freebies and shut shop the next day. And such promotional offers come with some rules that need to be adhered to.

    The rule, very clearly written was that we do not offer refunds and/or trials on promotional offers. This was disregarded, by both, the customer as well as PayPal.

    And try explaining it to PayPal that server access details are not sent by snailmail!

  • mikecmikec Member

    @jackb said:

    If anybody wants to know the full details of such a client

    Don't do that. Report them on maxmind and fraudrecord at most.

    You should never share customer personal details to unrelated third parties without the customers consent, or - having been instructed to by court/law enforcement, regardless of if the account is in bad standing.

    That's correct. I typically report these incidents in our admin area. We use FraudLabs Pro, which ensures the same users cannot subscribe again.

    Thanked by 1SmokyHosts
  • NaXalNaXal Member

    Even after you explained about "promotional offer constraints", pardon me for asking this stupid question.

    What's the benefit for the scammer here? What exactly you are scammed out of?

    May be a B2B scammer can overwhelm your promo offer and human resources, kind of a physical DDOS attack, like GPU or game console scalpers, to prevent genuine customers buying your stuff but apart from that, how is the scammer benefiting from this?

    Unless the scammer is your business competition, trying to do a physical DDOS to drown your offerings, this scam practice doesn't make sense from scammers point a view.

    Thanks.

  • SmokyHostsSmokyHosts Member, Patron Provider

    @NaXal said:
    Even after you explained about "promotional offer constraints", pardon me for asking this stupid question.

    What's the benefit for the scammer here? What exactly you are scammed out of?

    May be a B2B scammer can overwhelm your promo offer and human resources, kind of a physical DDOS attack, like GPU or game console scalpers, to prevent genuine customers buying your stuff but apart from that, how is the scammer benefiting from this?

    Unless the scammer is your business competition, trying to do a physical DDOS to drown your offerings, this scam practice doesn't make sense from scammers point a view.

    Thanks.

    The benefit for the scammer is to force out a trial period out of a non-refundable promotional offer. In the current case, maybe the scammer didn't cause much harm. Even if he did, it is not noticeable.

    But in the past, there have been scammers, who have done the same thing, by sending out a bulk of spam emails to get the IP blacklisted, prior to forcing out a refund. And yet, after all the possible proof, PayPal resolving the dispute in favour of the buyer.

  • @barbaros said:
    Can someone please explain what's wrong with sharing passwords in email in clear text? Are you that regarded to not change the password you got in the email? Are you special snowflake that you actually give provider your actual root password when you do reinstallation?

    You set your root password as "test". You get the email that server is ready, you login and change it to your real password. Then disable root login, Then create yourself new user and add ssh keys.

    Dear Sirs' Maam,

    we Do not use logic and reasoning in LET, my im ragebaiting

    best reaguards.

  • NaXalNaXal Member

    @SmokyHosts said: sending out a bulk of spam emails to get the IP blacklisted

    May be stop the email ports or outbound emails for a certain period of time till the paypal refund window is closed for your promo? or stop taking paypal for promo offers all together?

    Should not you or your team identify the "benefits" of these scammers?

    Then try and plug that to deny that benefit?

    Since if you are able to remove that from equation, scammers will no longer be interested anymore

    Thanks.

    Thanked by 1SmokyHosts
  • what's the point to do this kind of fraud? To get some free time on a VPS node?

  • SmokyHostsSmokyHosts Member, Patron Provider

    @NaXal said:

    @SmokyHosts said: sending out a bulk of spam emails to get the IP blacklisted

    May be stop the email ports or outbound emails for a certain period of time till the paypal refund window is closed for your promo? or stop taking paypal for promo offers all together?

    Should not you or your team identify the "benefits" of these scammers?

    Then try and plug that to deny that benefit?

    Since if you are able to remove that from equation, scammers will no longer be interested anymore

    Thanks.

    Appreciate your ideas.

    Yeah, we are already considering to add another choice of payment gateway, considering PayPal anyways doesn't support payments from close to 30+ countries, is way more expensive on the fees that they charge and ofcourse, not at all fair in terms of dispute resolution process.

    Blocking outbound emails and selectively allowing only to a certain set of customers, on request and verification is a good idea we can explore.

  • SmokyHostsSmokyHosts Member, Patron Provider
    edited July 2025

    @JerryHou said:
    what's the point to do this kind of fraud? To get some free time on a VPS node?

    Unfortunately, that's the impression it gives

  • @kuroit said: A client from UK sent us legal notice about a year ago stating that exact clause

    Very nice apart from the fact that that exact clause does not apply anymore in the UK.

  • cmeerwcmeerw Member

    @kuroit said:
    This is right below the "Right of withdrawal: a 14-day cooling-off period":

    Exceptions
    Please note: the 14-day cooling-off period does not apply to:

    plane and train tickets, as well as concert tickets, hotel bookings, car rental reservations and catering services for specific dates
    perishable goods that expire rapidly, such as food or drinks with a short “use by” date
    goods made to order or clearly personalised – such as a tailor-made suit
    goods or services with fluctuating prices following global markets, such as household heating fuel
    fully delivered services, such as cleaning a terrace, if you expressly agreed to start immediately acknowledging you would lose the right of withdrawal
    sealed audio, video or computer software, such as DVDs, that you have unsealed
    online digital content, such as a song or movie, that you started downloading or streaming after you expressly agreed to lose your right of withdrawal by starting the performance
    urgent repairs and maintenance contracts, such as inviting a plumber to repair a leaking shower

    None of these exclusions would apply for a bog standard VPS - it's not "made to order", "fully delivered", or "content".

  • @cmeerw said: it's not "made to order", "fully delivered", or "content".

    It depends how you argue it.

    Thanked by 1kuroit
  • kuroitkuroit Member, Host Rep, Megathread Squad

    @JohnFilch123 said:

    @kuroit said: A client from UK sent us legal notice about a year ago stating that exact clause

    Very nice apart from the fact that that exact clause does not apply anymore in the UK.

    Different words but says the same thing.

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