10 Warning Signs of eCommerce Fraud (Part 3): What’s the Rush?
By Emily Chin /
18 Feb 2015
J&R Bike Messenger by J&R Music World, on Flickr
Be honest, how often do you pay for rush shipping? What about for international orders — when are you willing to pony up the big bucks? Chances are that unless you’re running late on a birthday gift or missed your holiday shopping window, you opt for t he free shipping options. In our third installment of the “10 Warning Signs of eCommerce Fraud” series, we tackle signals 4, 5, 7, and 8 that deal with shipping and address details.
Fraudsters that use stolen credit cards or try to maximize reshipping services don’t sweat those added costs. Taking the time to check addresses and shipping speeds can help you save more than just money and merchandise in the long run.
Several major indicators of fraud that merchants rely upon relate to shipping. Because criminals want to capitalize on their bulk-orders of goods as soon as possible, “rush” or “overnight” shipping and international shipping see higher rates of fraud than their non-special-shipping counterparts.
Another indicator that many merchants employ is noting inconsistencies between addresses or an inordinate number of addresses used in a transaction. Think about your last online order and the information that you had to provide: email, billing and shipping addresses, telephone number that matches, etc. All of these factors add up to paint a picture. Multiple shipping addresses linked with just one billing address or many orders from multiple customers all shipping to a single location could be indicators of organized criminal activity. Without reviewing such orders, you’ll never know until it’s too late and that chargeback hits.
Finally, in this digital age, people can shop online at all hours of the day or night. Orders at odd hours of the day or night — in your local time — should be viewed with a healthy amount of skepticism. Yes, perhaps your customer is a jet-setting insomniac with an online shopping compulsion…but also perhaps not. Take the time to verify these midnight orders – it can net you thousands of dollars or more in revenue and cost-savings by accepting the good orders and avoiding the chargeback costs of accepting orders from these nefarious criminals.
From our post on “Seven Habits of Highly Fraudulent Users”
Thankfully, you’re not alone. These warning signs are around because other merchants have encountered these same scams and lived to tell the tale. And here is where data and shared knowledge come together. The information is out there to help you stop fraud — and for you to help others stop fraud too.
While setting a rule that, “Any orders from a new customer (new email address) purchased between midnight and 4 A.M. where billing and shipping addresses don’t match = fraud = cancel order”, might feel rational, unfortunately it also blocks some legitimate customers as well. Imagine the freshman college student: new email address, new shipping address, but credit card still linked to home (and mom and dad’s) info. He’ll probably mistype his information at some point (it is the middle of the night after all) and blunder through countless rules-based red-flags. With a rigid fraud-detection system, that customer would be lost to you, potentially forever.
With an intelligent system, however, access to real-time global fraud patterns help you identify that this suspicious college student’s email address is in fact linked with his personal email, with which he has a long and robust “good” order history. Leverage the data that’s available to prevent fraud and keep your good customers happy!