How to Avoid International Credit Card Fraud – 9 Red Flags
As an international eCommerce checkout and solutions provider, we see fraudulent conduct with credit cards online every day. In every case there are two victims: the cardholder and the merchant. Credit card companies typically attempt to protect their consumers by holding potentially fraudulent transactions – ones that are flagged by high values or suspicious purchases – for further review. While technology can help merchants out by displaying the IP address of the purchaser, using various anti-fraud procedures is always a good idea. It is important to remember that this type of technology is within reach of everyone, including fraudsters that will try to outsmart the system. Try to keep the following tips in mind when attempting to prevent fraudulent transactions.
- New buyers
New clients don’t have a purchase history, therefore, it isn’t possible to verify their past behavior. Try to establish long term relationships with your customers whenever possible.
- High Value Orders
Because the credit card holder will most likely become aware of any unauthorized transaction within a short period of time, the use of the stolen cards is generally very short lived. As a result, fraudsters will try to maximize profit as quickly as possible. While a large order can be exciting, keep a close eye on them and double-check the details on your buyer.
- Repetitive orders for the same item
Fraudsters will frequently order the same item over and over again. Keep a lookout for these orders and research the customer’s details.
- Rushed orders
Beware of shipping orders overnight. Beyond the compulsiveness of an average buyer, fraudsters will want to get the product as soon as possible – not allowing the seller time to investigate.
- Email addresses
While email can be convenient from a customer service standpoint, be aware that this is not a reliable form of customer identification.
- International addresses
Far from being a discriminatory measure, it happens that there is no address verification or AVS (Address Verification Service) outside the United States. Few countries are included in this system, which compares the first 5 numeric characters in the cardholder’s address and zip code with their credit card number. At this point we have to make a clarification. Because this service is not available internationally, this distinction has to be made through other means. Generally a copy of the customer’s driver’s license and credit card is sufficient. Because international fraud is so much more common, companies like ours exist to help protect the merchant from fraudulent orders.
- Short term repeat purchases
Beware of repeat purchases made within the same day with common countries, products and billing or shipping information. Fraudsters may have access to multiple stolen credit cards with limited time to use them.
- Observe the shipping address
Keep a close eye on countries with high fraud risk. Certain products, including electronics can be red flags for fraud to these countries.
- Differences in billing and shipping information
If you find that the billing address is different from the delivery address, proceed with caution. With the technology available today, fraudsters can acquire credit card numbers and their owner’s personal information by hacking personal email accounts and computers. Not all credit card holders are aware of this danger and, while they like to think that their personal information is safe, in reality it is at reach of anyone with bad intentions.
To monitor all of these red flags of fraud your company must be supported by some level of technology that manages your Merchant Account. If you’re considering each of these factors, it may happen that you lose an occasional sale in an effort to prevent fraud. This is unfortunate but it’s important to find that balance between being too wary and too accepting. It is also important to understand that those who deliver digital products are more vulnerable than those who sell tangible goods where there is always a delivery to a person with a signed receipt. Doing business online means taking some risks but if you are careful you can minimize them and take advantage of the many global opportunities for online sales.