Fintech company Afterpay [ASX:APT] experienced a 4.7% drop in share value this morning.
This comes after governance firm Ownership Matters uncovered a loophole in their system which allows underaged, resourceful kids to purchase any alcoholic beverage, or any other adults-only item, searchable on Afterpay’s supported retailer list.
Founded in Sydney, back in 2014, Afterpay’s shares have surged nearly 400% in the past 12 months, the ‘buy now, pay later’ business model a hit with young and old alike.
Miguel Launcha, the Spanish Mickey Mouse, purchases $250 worth of booze
On 2 January, 2000, Miguel Launcha was born. At least that’s what appeared on Afterpay’s records when Ownership Matters looked into them.
In reality, it was a presumably under-aged teen, accessing the site from an IP address in Melbourne, who counterfeitly inputted the name, and date of birth, of the mysterious El Mickey Mouse, in order to swerve the registration process and open up the doors to ‘buy now, pay later’ alcohol.
Using a pre-paid Visa card, originally under the name of Giftcardholder, Launcha was able to register the card under his ‘own’ name, and proceeded to purchase more than $250 worth of alcohol.
In an effort to quell the worries of parents, and to the dismay of their under-age children, Afterpay said in a statement to the Australian Securities Exchange that they were revamping their systems to ‘curtail alleged under age usage of its service by dishonest users’.
They went on to say that customers were legally obligated to identify their birthdates, and that merchants were obliged to only sell to those above the legal drinking age. Though it is unknown how many of these ‘dishonest users’ respect legal obligations, especially those that are only enforced via an ‘enter your birthdate’ field.
When questioned about the potential for other shortcomings in their convenience-first registration and business model, Afterpay stated that they would welcome any further reviews from regulators.
For Money Morning
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