Editor’s note:
While COVID-19 is harming businesses everywhere, unemployment is rising, and competition for consumer attention is increasing; criminals are not slowing down. In fact, if you're experiencing any slowdown to your business at all, fraudulent activity can start to have an overweight effect on your total profit which will put your business in an even more difficult position to succeed. Datafiniti's mission has always been to help virtually every business everywhere and now that mission is more vital than ever as countless retailers might struggle to keep their businesses open in today's economic environment.
E-Commerce Fraud — Could Your Store Be the Next Target of Online Fraud?
It is the moment both your business and people everywhere dread. An innocent person checks the balance of their bank account or credit card and finds a fraudulent charge with your company’s name as the merchant. Unfortunately, when it comes to e-commerce fraud, the right time is anytime. In 2019, half of businesses across 21 countries reported an increase in online fraud-related losses.
A robust strategy for fraud prevention goes beyond customer retention and reputation management. Arm your team with the necessary tools and potentially avoid the crisis of $35.67 billion in card fraud expected globally by 2023. Criminals looking to profit from your business do not wait, and neither should you. Read on in our on-going series to learn how Datafiniti can help mitigate online fraud.
What Is E-Commerce Fraud?
E-commerce fraud is when a criminal acquires and illegally utilizes a consumer’s personal payment information (bank information, credit card, or debit card) to make purchases without their consent. In other cases, the criminal may also employ false information to complete transactions.
As online shopping transforms the traditional B2C and retail sector, the opportunity for fraudulent purchases continues to rise. With emerging technologies, increasing sales, and diverse payment options, criminals are using the industry as a testing zone; they go big and get better with each buy.
Who Does E-Commerce Fraud Affect?
From niche sites to retail giants, e-commerce fraud can affect businesses large and small by taking on many forms. The actual scale of fraud is proportional to the demand for a product. However, the loss incorporates more than just the cost of a product.
The cost for each dollar lost to fraud is up 6.5%, to $3.13 for fees, labor, security, and more since 2018. Even more detrimental to profitability are the combined costs of fraud and customer loss. Almost half of shoppers report they will abandon a retailer after an incident of fraud.
Stay ahead of online fraud with these two methods of scams we experience with Datafiniti customers.
Top 2 E-Commerce and Online Fraud Trends
Customers connect with our team to prevent profit loss and detect e-commerce fraud in the online order and delivery of their consumer goods. The challenge companies face is that criminals continue to raise the bar with creative approaches to securing products obtained through fraudulent purchases. A new strategy by fraudsters exploits publicly accessible property data found online.
Here are a few ways criminals could be taking their illicit activity from online to offline in your neighborhood.
Billing Fraud. Billing fraud occurs when a criminal lists a delivery address different from the actual address belonging to the victim as they make fraudulent purchases. The criminal uses the address of a newly constructed or listed home, picks up the product, and relists the item.
Identity Theft. Identity theft occurs when a criminal acquires stolen payment or personal information belonging to the victim. The criminal uses bank accounts, user accounts, cards, location details, and more to appear as the customer as they make fraudulent purchases.
4 Simple Steps to Fraud Prevention
While fraud tactics evolve in the digital age, protection against e-commerce fraud comes down to how you manage the risk. The first move in tackling the threat is to identify problem areas specific to your business. For those who uncover red flags with address discrepancies, as we explored above, the Property Data landscape offers several solutions. A quick start to success can begin with the optimum combination of in-house verification technology, fraud scoring, and more.
Fight online fraud in four simple steps using Datafiniti’s Property API. (we’ll give a more detailed rundown in a future article. And as always, feel free to connect with one of our experts to talk about your use case today.)
Connect. Connect your application to Datafiniti’s Property API to your orders.
Create. Create an API call that queries for a specific property address and the date that corresponds to the most recent status for a given property.
Score. Score the possible fraud request based on the data returned.
Generate. Generate an alert pertinent to your business practices as necessary.
Still feel like you need more help? We offer a free on-boarding to all our customers. Further, we’re also launching a limited availability BFF-program (Beat Fraud Forever) where we will work hand-in-hand with you for no-added cost in order to maximize the effectiveness of any fraud prevention efforts we can jointly pursue.
Stay tuned for an in-depth look into how you can maximize your use of our Property API later in our series.
Put Your Online Fraud Prevention Plan Into Action
If e-commerce fraud is not already hammering your business, its impact in the next decade is imminent. The best way to prevent future of online criminal activity is to implement a solution ready to stop it in its tracks. At Datafiniti, we are here to support your team in distinguishing and deterring fraudulent purchases with real-time Property Data. Proactively take the guesswork out of fraud prevention by putting policies into place, enhancing existing internal processes, and applying fresh real estate insights.
Join our team throughout this series as we examine the manipulation of property data in e-commerce fraud and how your business can take the necessary measures to manage fraud prevention.
Is your business losing too much to online fraud? Schedule time with our team to learn more.
