How To Deal With Fraudulent eCommerce Orders
Generally, when fraudulent ecommerce orders are discovered, a merchant has a choice between two courses of action. You can just write it off as an operating cost, or you can take some action to ensure your business isn’t victimized again. In most cases, when somebody discovers your site is vulnerable, they will continue to exploit that vulnerability until it isn’t viable anymore. For this reason, merely shrugging it off is a bad idea. When you’re considering how to deal with fraudulent ecommerce orders, your first step should always be to conduct a review of your processes to identify the hole and plug it before someone else finds it too.
Because credit card fraud is such a common occurrence, it’s important to create a file for each incident and keep all of the pertinent information surrounding the transaction on hand. This way, you’ll create a database of individuals engaging in fraudulent activities, so when their names or their IP addresses crop up, your system will trigger a red flag and prevent them from stealing from you again. Make every effort to ensure the files contain only actual cases of fraud so you don’t alienate good customers out of confusion.
This documentation is key to preventing recurrences. Additionally, if you should also choose to file criminal charges, you’ll be able to provide key information such as the IP address from which the order originated, as well as the shipping address and telephone number the perpetrator provided. By the way, if you haven’t been collecting all that information, it’s past time to start. Requiring a signature for delivery is another useful tool for circumventing and tracing fraudulent activity. The best ecommerce website builder platforms also have fraud prevention apps you can use to protect your site.
One specific person (or group) within your organization should be designated to handle all aspects of credit card fraud. This way, you don’t have five different members of your staff running off in five different directions, operating in five different ways. Further, with one individual or department tasked with mitigating fraud, your efforts are likely to be more effective, because all they have to do is look out for offbeat activity. This group can also be tasked with routinely probing your system for potential weaknesses and shoring up your defenses.
Another advantage to having a specific individual or group tasked with this activity is the ability to establish a working relationship with the local authorities. This will improve your chances of catching perpetrators. This person or group will also have clear instructions on what information needs to be provided to the police department to give them the best chance of tracking down suspects. The better the intel you supply law enforcement officials, the better they can work to get you a positive result.
Internally, once it is verified a fraudulent order originated from a particular IP address, block it (unless you’re asked not to do so by the police). Criminals, though they are often willing to go to what seems like extraordinary lengths to avoid working, are basically lazy. When they find they’ve been blocked from your site, they’ll usually move on to an easier target.
When it comes down to it, the best way to deal with fraudulent ecommerce orders is to have a system in place to prevent them beforehand—along with a mechanism for responding should they occur despite your best preventive measures. These strategies will take you a long way toward mitigating losses.