Online payment fraud has become a common phenomenon in the World
Wide Web. Today consumers do a big chunk of their shopping through e-commerce
sites. Transactions worth billions of dollars are made on a daily basis. To
that effect, one would have to learn to expect the possibility of fraud since
scammers always tend to be where the money is.
Online business are prone to different types of online payment fraud. Scammers who pose as a customer go to great lengths to devise
elaborate scams which enables them take advantage of loopholes present in
modern day payment systems. Here is a look at ways in which scammers indulge in
fraud while using web based shopping sites.
Credit Card Online Payment Fraud
The is the most common form of online payment fraud when it
comes to e-commerce sites. Here the scammers use stolen credit card details to
make a series of purchases. Depending upon the scam, the cyber criminal may
have access or not to the CVV security numbers. If they do not have access,
they will try their luck by punching in numbers at random which could lead to a
number of failed transactions on the site. To protect your business from such
criminals, keep a limit on the number of failed transactions. And also make
sure that people have to type in their CVV number at the end of a transaction
which simply adds another layer of security.
Tracking Orders
A lot of scammers use sometimes simple methods to carry out
their scams. They will indulge in online payment fraud by placing orders for a
certain item. Once the product has been delivered, they will call up the
company and say that they didn’t receive delivery. This is why, modern e
commerce sites use tracking systems to provide regular updates on shipment
details and also ensure to get the signature of the customer when the product
is delivered.
IP Address and Profiling
You may sometimes need to use GEO location tagging
technology to IP addresses of customers whose shipping address is completely
different to their billing address so much so that they might happen to be from
different countries. Such people must be monitored closely for online payment
fraud. On the other hand, these person might have just wanted to present a gift
to a friend or relative staying abroad which would of course require different
addresses. So it is important to monitor such purchases since it could be
either bogus or genuine.
Security
System security is one of the most important attributes to
successfully preventing fraud. Hackers always look to break into servers owned
by e-commerce companies. The servers of course store credit card information of
thousands of customers and when this data gets leaked, it leaves them severely
vulnerable to online payment fraud. And the issue is a lot worse than one can
imagine since the scammer may not directly use the credit cards for his own
personal gain but might sell the details on the dark web for thousands of
dollars. Now many people may have access to these credit card details making
the possibility of the online payment fraud even the more dangerous.
In such an instance, you should think about how vulnerable
your business would become. You would be fighting multiple lawsuits from
customers and you might have to pay out huge amounts to cover the losses.
Instead, it makes better sense to invest in top grade security facilities for
your site. Make sure that the sites security is fully complaint with the
safeguards of the payment industry. If possible also hire a team of tech
experts who will monitor your site for suspicious activity.
