As the frequency of online shopping continues to swell, so do the cases of online fraud. According to the U.S. Census Bureau, e-commerce sales increased 16 percent year-over-year, but that influx of e-commerce shopping necessitates that merchants be even more hypervigilant in protect consumer data to avoid near-catastrophic breaches. A spokesman for Chargebacks911, a payment process protection platform cited a report released by Experian that revealed online shopping fraud increased by 30 percent in the last 12 months.
“Online retailers have reason to be excited by the latest e-commerce sales figures, but they also need to follow CNP fraud trends to understand the net impact on their bottom line,” explained Monica Eaton-Cardone, cofounder and chief operating officer of Chargebacks911, a payment process protection platform.
But retail executives have plenty of strategies to address threats head-on. Eaton-Cardone suggested deploying address verification systems to confirm billing addresses match information on file with corresponding credit card companies.
A Chargebacks911 spokesman cited an Experian report on combating fraud when suggested to pay attention to orders that tout foreign IP addresses. “Orders originating from a foreign Internet protocol address were seven times riskier than average, with IP addresses from China and Venezuela linked to the highest risk of fraud,” he said.
What’s more, the spokesman said that using geo-location and smart technology to dismantle false credit card declines is pertinent to validate legitimate transactions.
“It’s critical to have an effective loss-prevention program in place to ensure fraudsters aren’t the ones getting rich off your sales and marketing investments. However, that’s not all you need to do,” Eaton-Cardone said. “It’s equally important to continually review and reassess those antifraud measures to stay ahead of criminals’ evolving tactics and the many different types of potential losses, from identity theft to charge-back fraud.”
Eaton-Cardone went on to suggest that merchants challenge charge-backs. “Some merchants consider charge-backs a necessary cost of doing business, but failing to dispute charge-backs contributes to an ongoing increase in friendly fraud. In addition to engaging in tactical representation, it’s wise to flag and scrutinize orders from customers that have previously filed a charge-back,” she said.
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