Fraud orders are not fun to deal with and they can be really annoying. They will cost you your money as well as your time and when you are running your own ecommerce business, you can never have enough of either. So, if you get fraud orders, here are a few ways to help you detect if it is a fraud order.
Shipping and billing address do not match.
If the billing and shipping address do not match, it could be a fraud order. Someone could be using a form of payment that isn’t theirs and shipping it to a different location. Also, if the addresses don’t match AND they have next day shipping, this could be a sign of a fraudulent order. Turning on the AVS setting, or address verification, could help deter these orders away. The downside of this logic is that maybe your customer is buying your products for a friend or relative located elsewhere.
According to the Merchant Risk Council, fraudulent orders with international addresses are 2 ½ times more frequent than orders with domestic addresses. So unless the customer with the international address is a frequent customer, you should be careful accepting the order. If you get a lot of fraudulent orders, it may be best just to ignore international orders all together.
Use Card Verification Codes (CVC)
Most online business owners use this option, but I just want to reiterate it. This is the 3 or 4 digit code on the back of the credit card. If the customer provides this and it goes through the verification system successfully, then the customer probably has possession of this card.
Post a Warning
This is a simple way to help keep fraudulent orders away. In your checkout process, just state somewhere that you have anti-fraud procedures. This simple text could make criminals think that it will not be worthwhile to try and steal from you. One or two fraudulent orders every 6 months or so isn’t too bad, but having fraud orders often really adds up and could be the difference maker for your website.