| |
|
POSitive Processing Blog
Is Friendly Fraud Putting Your Business at Risk
Wednesday, May 29, 2019
BEWARE THE FRIENDLY FRAUDSTER
.png) With more and more skimming devices being found on ATM’s and
gas pumps and merchants experiencing data breaches more frequently, we are
often versing ourselves on how to protect ourselves from these fraudulent
criminals. But we often forget to guard ourselves against one of the biggest
threats there are: The Friendly Fraudster.
The Friendly
Fraudster is a customer with impeccable digital risk profiles that pass
every fraud screening test but make authorized purchases and later claim them
as unauthorized. They order a product or service and provide legitimate billing
and shipping information. After receiving their order, they contact the
merchant or their card issuing bank and dispute the charge.
Some of the various false claims they can make are:
· Their order never arrived.
· The service was never rendered.
· They don’t recognize the transaction.
· The transaction was unauthorized.
· The goods were damaged.
While this isn’t the traditional eCommerce fraud you
imagine, Friendly Fraud is a very real threat and merchants should be aware.
Consider this:
· Merchants lost $11.8 billion to cases of
friendly fraud in 2012 and 40% of consumers who engage in friendly fraud will
do so again within the next 90 days.
· Friendly Fraud has risen 41% since 2011 and 86%
of chargebacks are linked to friendly fraud.
· Friendly Fraud is one of the top three threats to eCommerce,
according to the FBI.
So what can you do when a customer goes bad?
1. Clearly
communicate: Merchants should be upfront and clear with customers about
their policies and practices and then immediately email order invoices. This
will lessen the possibility of the charge being disputed.
2. Know your
customer: Use chargeback data and customer service data to analyze a
customer’s profile and identify abusive claim patterns. If the same customer,
shipping address, etc. is repeatedly associated with claims, it is likely that
they are committing friendly fraud.
3. Enforce
stricter order processing: Once repeat offenders are identified, make
signatures mandatory for proof of delivery for all future orders. Both the
signature and now higher shipping fee should be red flags for the customer that
he is under scrutiny. Ultimately, the goal is to frustrate fraudsters.
4. Put
customers on notice: Notify customers in writing that no further refunds
will be issued due to repeated, unwarranted claims.
5. Leverage
chargeback representment: Engage in chargeback representment—it informs the
card issuer that more due diligence is required the next time the customer
requests a bank issued refund.
The bottom line is being vigilant is key to stopping ALL
types of fraud, and to be vigilant you must be knowledgeable. Know your risks.
Know your equipment. Know your customers. Contact us for more information on
how you can better protect your business.
|
|
|
|
Blog Categories
Miscellaneous
11/21/2019 - Shortened Shopping Season
06/21/2019 - VeriFone Terminals
02/27/2019 - Take The Hassle Out Of Tax Sea
02/13/2018 - Innovative Visa Wearables Make
02/13/2018 - Little-Known Secrets of Credit
07/19/2017 - Beat the Summertime Blues
Just For Fun
11/14/2018 - Thanksgiving Fun Facts
05/24/2017 - Facts You Might Not Know (or M
03/13/2017 - Keys To Success — 8 To Be Grea
09/02/2016 - Happy Labor Day Weekend!
Payments Industry
03/06/2019 - Merchant Rules To Live By
01/09/2019 - Account Tune Up for the New Ye
09/19/2018 - Has Your Bottom Line Seen the
09/18/2018 - Are Your Business Merchants’ S
05/22/2018 - Interchange Explained
04/11/2018 - What to Avoid When Searching f
04/06/2018 - The Importance of Choosing You
12/21/2017 - The Basics of Chargebacks
12/12/2017 - No Need to Sign on the Dotted
07/26/2017 - Back to the Basics - Merchant
03/17/2017 - Innovation Project 2017
Products and Services
01/29/2020 - Let Us Help You Reach Your Goa
07/31/2019 - Mid-Summer Reboot
10/03/2018 - Are Your Business Customers Se
08/15/2018 - Introducing Poynt… The World’s
06/11/2018 - Interchange Savings Tool Now A
01/03/2018 - Data Breach? We Got Your Back
12/27/2017 - How Does OMEGA Protect Your Cu
12/12/2017 - New Year? New Goals? New Capit
12/06/2017 - Process with the Best
09/06/2017 - Unlock Cash Flow Opportunities
08/30/2017 - Are You Hungry for the Details
08/09/2017 - Happy (2nd) New Year!
11/30/2016 - Are You Ready?
Data Security and Fraud Prevention
05/29/2019 - Is Friendly Fraud Putting Your
04/29/2019 - Gift Cards: The Gift That Thie
04/03/2019 - Chargebacks: What Are They and
02/13/2019 - 3 Tips To Protect Your Busines
11/12/2018 - Are you PCI Compliant?
03/14/2018 - Merchant Guide: 10 Essential T
02/12/2018 - Common Business Scams and How
02/09/2018 - Data Security Fast Facts
01/17/2018 - Vulnerability Scanning vs. Pen
01/17/2018 - BBB Warns of Email Scams This
01/10/2018 - Arm Your Business Against Cybe
11/15/2017 - MERCHANT FRAUD ALERT, 11-15-20
09/22/2017 - Have You Heard How OMEGA’s Dat
08/02/2017 - MERCHANT FRAUD ALERT, 08-02-20
OMEGA in the Community
07/05/2017 - Parades, Baseball and the Four
03/08/2017 - 9th Region Championship Player
02/06/2017 - OMEGA’s Players of the Game
01/23/2017 - TWO New OMEGA Player’s of the
01/13/2017 - OMEGA’s Defensive Player of th
01/09/2017 - 2017’s First OMEGA Player of t
11/21/2016 - OMEGA’s Offensive Player of th
11/14/2016 - OMEGA Processing Offensive Pla
11/10/2016 - OMEGA in the Community
11/07/2016 - OMEGA Processing’s Player of t
10/31/2016 - OMEGA Processing Player of the
10/25/2016 - OMEGA Processing Player of the
10/12/2016 - OMEGA Processing’s Player of t
10/04/2016 - OMEGA Processing Player of the
09/19/2016 - Sergent Wins Player of the Gam
09/06/2016 - OMEGA Processing Solutions Pla
OMEGA Merchants, News, and People
12/12/2018 - 2018 Year in Review
10/17/2018 - OMEGA Processing Solutions Cel
07/25/2018 - OMEGA Processing’s Kim Polark
05/31/2018 - OMEGA Processing’s Daena Spraf
04/20/2018 - Making Every Day Earth Day
04/11/2018 - How’s an Extra $100 Sound?
12/28/2017 - 2017 Year in Review
10/11/2017 - NO Contract. NO ETF. NO Long-T
07/05/2017 - OMEGA Processing Solutions Add
12/30/2016 - Some of our Favorite Moments
09/01/2016 - OMEGA Processing’s Caroline Ok
Mobile Payments
11/08/2017 - Mobile Made Easy with OMEGA
08/03/2017 - A Good Thing Just Got Better —
10/18/2016 - SwipeSimple: Mobile Made Bette
B2B and E-Commerce Solutions
08/26/2019 - Maximize Your B2B Interchange
10/13/2017 - Saving on B2B Interchange
05/03/2017 - EMV Option Now Available for V
02/09/2017 - Why Should Your B2B Business A
Short-Term Capital Funding
Gift Cards and Customer Rewards
04/01/2019 - Spring Has Sprung and So Can Y
09/06/2018 - The Holidays Are Coming..Are Y
08/22/2018 - Sales are up 100%!
09/13/2017 - When Should You Start Planning
08/18/2017 - Black Friday is Coming!
07/19/2017 - Gift and Loyalty: We Have an A
02/23/2017 - Boost Spring Sales with OMEGA’
Point-of-Sale Systems
FI Partner Program
OMEGA Spotlight
01/13/2020 - OMEGA Spotlight-Events LLC
12/04/2019 - OMEGA Spotlight-Dean Sturtz
11/20/2019 - OMEGA Spotlight-Canterbury Far
10/24/2019 - OMEGA Spotlight-Sarah Jeffries
10/10/2019 - OMEGA Spotlight-Outlier Cycles
09/25/2019 - OMEGA Spotlight-Bruce Morris
09/10/2019 - OMEGA Spotlight-Pangallo's on
08/27/2019 - OMEGA Spotlight-Hair Plus Beau
08/14/2019 - OMEGA Spotlight-Customer Servi
07/23/2019 - OMEGA Spotlight-Eddie's Southe
07/10/2019 - OMEGA Spotlight-Barbara Bailey
06/25/2019 - OMEGA Spotlight-Big Catz BBQ
06/11/2019 - OMEGA Spotlight-Kim Figgins
05/23/2019 - OMEGA Spotlight-Kava House & C
05/14/2019 - OMEGA Spotlight-Stevie Dumbuya
|
|
|
| |