ECommerce 101: Protect Your Business from Fraudulent Sales

MerchantProcessingNMCredit Card Processing/ Merchant ServicesLeave a Comment

Fraud can happen to any business. It can lessen sales, decrease customer trust, and if it becomes a frequent issue, put a company out of business. However, there are a few things you can do to protect your business from fraudulent sales. Check out these helpful tips on how to prevent fraudulent sales within your business:

  • AVS (address verification)

When the shipping address for the product sold does not match the billing address on the credit card, it could indicate fraudulent sale. It may simply be that the cardholder has moved or is shipping to a location that they do not live, such as a friend’s house or even an office building. Keep in mind that the shipping address will never match when someone is  purchasing from your site with a stolen card. Call the customer before shipping, and verify the address. If it sounds fishy, do not ship the product. It’s likely this credit card transaction is not part of a legitimate purchase.

  • Shipping and IP Address

Does the shipping address and the address on the card match the IP address from the customer who placed the order on your e-commerce site? If not, then this might not be an authorized transaction. At Electronic Money Company, we have technology for eCommerce merchants to check if the IP address corresponds to the shipping address to ensure validity before the transaction is processed.

  • Large Ticket Orders from Overseas

Scams are more likely on overseas transactions because it’s harder to communicate with cardholders. Moreover, it’s difficult to research fraudulent transactions from other countries with different legal jurisdictions. Unfortunately, it is also more difficult to win back fraudulent overseas transactions. The best practice is to call all the customer’s phone number and make sure someone answers with the same name.

  • Too Good to Be True? Avoid Transaction!  

Remember that if it is too good to be true, the transaction is probably a fraudulent purchase. More often than not you’ll lose the product and the credit card will be reversed, thus leaving you with not only lost merchandise, but all payment for that transaction. On a stolen card, the transactions goes through and is deposited to your merchant account, but it will be reversed when the owner of the stolen card realizes their card was used fraudulently giving you a false impression of true transactions.

If you’d like to know more about how to keep your eCommerce business better protected from fraud, give Electronic Money Company a call today!