Shopify Fraud Prevention

[Megahurtz400]

Hi guys,

My business is going from strength to strength and our website is now seeing around 600-700 orders a month which is great!

However, not so great is the amount of fraudulent orders we're seeing, especially in the last few weeks.

Some are obvious to spot, but we've had a few cases the last few weeks where someone has called up and asked for an expensive product, their name has matched the name of the card, the card payment goes through with the shipping address they've provided, but a few days after the items have been delivered a chargeback is raised and despite compelling evidence being submitted to prove that we delivered the goods to the correct address we lose the chargeback.

Are these people using "cloned" cards to get their name on them?

Awkward thing is they're on the phone so we can't exactly start accusing them of being a scam, but have taken to saying that out card payment system is down and they'll have to pay bank transfer if they want the goods for now.

So, is there anyway around this? We use Shopify so is there an App which can help?

Cheers!

 

[Deleted member 77746]

Are these people using "cloned" cards to get their name on them?

All it takes is the card to be used online with no security check and it will go straight through. It could either be a cloned card or a card that's been stolen from someone. There's something coming into play where you must put a pin in to verify the transaction on online transactions soon bit like 2FA.

So, is there anyway around this? We use Shopify so is there an App which can help?

I believe there are checks that are done on the payment gateway end so if you use stripe for example it can decline certain orders of value or other checks I believe. I know with wordpress / woocommerce, stripe this is what can be done.

I guess you can't prove it's a fraud transaction until someone says it is somewhere that their card has been used fraudulently.

 

[Iamzod]

Do you have 3DS2 enabled & AVS checks?

 

[Vanquish-Storm]

This is one of those things I found to be a massive con. You pay a payment gateway to handle transactions, if you get a report of fraud (genuine or not) there’s a charge back and then that same payment gateway charges you. Not only are you down stock you get booted for the extra charge.

On top of this the authorities could not care less about fraud, we had a portfolio of evidence against a fraudster along with their address and the police not action fraud couldn’t care less.

Back to the question, there are a number of apps for shopify that are supposed to help with fraud and some even insure your loss. We never got on with them and they are mainly aimed at the US market. If I remember right we ended up using shopifys own app and configuring it to what we thought would work.

 

[Deleted member 77746]

On top of this the authorities could not care less about fraud, we had a portfolio of evidence against a fraudster along with their address and the police not action fraud couldn’t care less.

I'm suprised at this, fraud is a crime by law.

 

[Vanquish-Storm]

I'm suprised at this, fraud is a crime by law.

Not enough resource for them unfortunately. The police themselves just refer you to action fraud.

 

[Vulcan]

As Iamzod suggested, 3DS2 might be an option if your gateway supports it or is going to support it very soon...

Merchants are not liable for fraudulent transactions if they are processed by 3DS2. If a cardholder disputes a 3DS2 transaction (for example using a chargeback) on the basis that it is fraudulent, it is the responsibility of the bank to refund the cardholder if required, because the issuing bank will have approved the 3DS2 transactions.

 

[Vanquish-Storm]

Who is your payment processor?