Originally Posted by http://www.news.com/8301-13579_3-9921271-37.html?tag=newsmap

Psystar violated terms of merchant services agreement
Posted by Tom Krazit | 3 comments

The payment-processing merchant for Mac clone maker Psystar abruptly ended its relationship with the company Wednesday after it discovered what was for sale on Psystar's site.

Powerpay refused to process any more transactions for the Open Computer after learning what it was.
(Credit: Psystar)

Powerpay had been the payment processor for Psystar's online store until Wednesday, when it yanked its services from Psystar's Web site. That move sent the store offline for several hours midday Wednesday, halting sales of Psystar's Open Computer, which comes preinstalled with Mac OS X Leopard in violation of Apple's licensing agreement for its operating system.

Psystar posted a statement on its Web site Thursday explaining the downtime. "Midday yesterday our store was not receiving any orders. This was due to the fact that our merchant gateway, Powerpay, dropped the ball on us and refused to process any more transactions from our company."

Louisa Deluca, vice president of loss prevention for Powerpay, said on Thursday that her company dropped Psystar because it violated the terms of its agreement with Powerpay. She declined to cite specific violations, but said "there are plenty of reasons why we shut the account off. We did not know that's what he was selling, we learned that yesterday."

Psystar has since switched merchant services providers to PayPal, who processed my transaction with the company on Wednesday. A PayPal representative did not immediately return a call seeking comment on that company's policies regarding sales of goods such as the Open Computer.

Psystar is still under siege from the press. A gentleman answering the phone Thursday morning directed all inquires to a press e-mail alias, and if I receive a response from the company, I'll let you know.

UPDATED 11:30am - I managed to obtain the cell phone number for Rudy Pedraza, who appears to be the owner of Psystar. A polite gentleman who answered the phone said that he was not Rudy, but confirmed the number belonged to Rudy. He took a message for Rudy, and promised to have him call back. Right. Holding breath.

The company also attempted to explain the elusive nature of its home address in Southern Florida in a statement posted on their site Thursday. Psystar's address has changed no less than three times in three days since the story exploded on Monday.

"We're in the process of moving to a new location which is now listed on our contact page," the company said in the statement. "The first new address posted (10481) was in error and our correct address is 10475 NW 28th Street. Psystar was, prior to this past week, not ready to handle the enormous production capacity demanded by the online community. Due to the incredible response we have now expanded to a larger commercial unit to handle the supplies and assembly of Open Computers."

Meanwhile, a News.com reader passed along an e-mail from a colleague who had alerted him to Psystar's existence on April 6, a week before the Psystar story blew up on Sunday night and Monday morning. That's the first instance I've heard of somebody who was aware of the Open Computer prior to Sunday evening, but if other people were aware of its existence earlier this month or year, please send me an e-mail or leave a comment below.

Originally Posted by http://government.zdnet.com/?p=3761

Walk through the Psystar fiasco with me. Many things are confusing. At a minimum, it’s clear that the OpenMac is bogus. It’s extremely dubious that Psystar is a legitimate company. It is increasingly likely that the whole thing is a phishing or credit-card scam.

Item: The wandering hardware company. Psystar’s address, as displayed on its website has changed four times since the story hit on Monday.

Address 1: 10645 SW 112th St., Miami

Address 2: 10481 NW 28th St., Miami

Address 3: 10471 NW 28th St., Miami

Address 4: 10475, NW 28th St., Doral

Psystar attempts to address suspicions about this with this statement on the website:

We’re in the process of moving to a new location which is now listed on our contact page. The first new address posted (10481) was in error and our correct address is 10475 NW 28th Street. PSYSTAR was, prior to this past week, not ready to handle the enormous production capacity demanded by the online community. Due to the incredible response we have now expanded to a larger commercial unit to handle the supplies and assembly of Open Computers. THANK YOU for all of your orders.

The whole address thing is admirably reported by The Guardian’s Charles Arthur and the loyal readers of Gizmodo, who tracked down the addresses and snapped pics. It’s not clear to me that the latest address actually exists. Mapquest says the address exists. Google Maps says it doesn’t.

psystar1.jpg

Item: No lawyers: Here Psystar (who no one’s ever heard of) is challenging one of the largest and most litigation-friendly companies in Silicon Valley on a matter that goes to the heart of end-user license agreements — a complicated and unsettled area of law — and one with ramifications for the entire industry. But Psystar’s lawyers are nowhere to be heard of. Even weirder: Psystar’s Rodolfo Pedraza has been talking to the media. Assuming he has lawyers, they’re not telling him to shut up?

Item: Credit-card processing. Psystar is taking credit card numbers. It’s not processing them. People who tried to order machines yesterday got this message:

Thank you for visiting Psystar. We’re sorry but the store is temporarily down due to the fact that we are currently unable to process any credit card transactions. Please send an e-mail to support@psystar.com with the subject line “UPDATE” so that we can update you when the store comes back online. For customers who have already placed orders: if you received a confirmation e-mail then your item is in queue to be built and shipped.

Today Pystar confesses they don’t have a processor:

Midday yesterday our store was not receiving any orders. This was due to the fact that our merchant gateway, Powerpay, dropped the ball on us and refused to process any more transactions from our company. We have reverted to Paypal until we can find a high-volume merchant. Apparently Powerpay was not ready to handle the community’s demand for Open Computing.”

News.com’s Tom Krazit reports today that Powerpay yanked Psystar’s account Wednesday when it discovered what it was purporting to sell.

Louisa Deluca, vice president of loss prevention for Powerpay, said on Thursday that her company dropped Psystar because it violated the terms of its agreement with Powerpay. She declined to cite specific violations, but said “there are plenty of reasons why we shut the account off. We did not know that’s what he was selling, we learned that yesterday.”

Item: Floridatek.com. Psystar principal Rodolfo Pedraza is also listed as the registrant for a company called FloridaTek.com. As pointed out on Gizmodo, if you go to the site and click almost anywhere, you will get the chance to save a .exe file to your computer.

Conclusion: Psystar is collecting credit cards numbers, encouraging that people send them email, and engaging in spyware. It’s a phishing/credit-card scam. If you gave them your credit card number you should alert your bank. You might want to contact the FL Attorney General. I contacted them and they said to date they have no complaints about Psystar or Pedraza.

Originally Posted by http://government.zdnet.com/?p=3762

Posting email I received from Andrew Storms, director of security ops at nCircle Network Security:

There are absolutely enough key indicators here to warrant concern. The Pystar folks simply aren’t escaping from this one unharmed. Lets start with Apple. They will most certainly sue under the terms of their EULA. Despite the outcome of any lawsuit, Apple has enough cash to send Pystar to
bankruptcy regardless. Next, the consumers are going to have field day on this. If Pystar fails to deliver a product and they took credit cards,
expect more lawsuits. This all assumes that Pystar is truly attempting to run a legitimate business.

What if they really aren’t so innocent and they are in the business of crime? We already have a number of crimes committed which will send them to jail for a long time. Lets start with fraudulently collecting credit card numbers and misrepresenting themselves to the public. And now according to
the Gizmodo piece, it appears that the same people are running a website which may be hosting malware. Let us not forget that these people and the
websites are located in the US. Nobody launches or runs Internet based attacks from inside the US, its an instant go directly to jail coupon. I
bet the FBI is already on the case and has these people under surveillance.