Spotting fraud

As the convenience of Internet shopping increases, so does the intrusion of online hackers. Online criminals are always trying to take advantage of online shopping and shipping to commit fraud.

For consumers whose credit cards are used in online fraud, the loss is minimal. These fraudulent charges are usually refunded. However, those online retailers who are duped into processing false orders are the ones who are truly harassed. If it's fraud, you get a chargeback.

The one single way to reduce fraudulent orders is to eliminate shipping to any location other than what you are used to or are familiar with. Most frauds originate overseas. Here are some suggestions to spot fraud before it is actually committed.

Shipping FedEx overnight is a distinct marker. The reasoning is that there will be less scrutiny if done quickly and in the nighttime. A cause for you to seriously question the order is when the overnight shipping costs are the same as the item's cost.

Check out the phone number and e-mail address provided by the customer. Does the area code match the city and state of the customer? Does the free email account correspond to the customer's name? An e-mail to a domain not associated with free web-based accounts, with a username that matches the customer, is usually good. Also, check the IP address of the customer. This is a unique numerical identifier much like a house address. In this case, it identifies the computer network that the order came from. The software will also show you the IP address that the order was sent from.

If your store has referrer info on orders, find out how the customer chose you. The store's order info usually lists the search phrase they used, or the last page they came from. Thieves tend to search on phrases like "international shipping" or "overnight delivery" instead of the category or keywords.

A word of caution to those customers who give shipping addresses with Post Office Boxes. Many thieves order your items from overseas and have them shipped to mail drops or post office boxes. Often, instead of a box number, these locations are denoted by having a "suite" number under the address line. If in doubt, run the customer address through Google. Often you'll see it listed to a service for mail forwarding company.

Another thing to be aware of is the difference in the shipping address and the billing address on the order. In such an event, it is advisable to call the customer to confirm the order. Some stores make it a policy to ship only to the billing address listed for the credit card.

Be wary of multiple orders submitted from the same customer repeatedly, using the same credit card, or the same ship-to address. Also, beware of unusually large orders. Check out the norms of how much of that product is usually shipped and what value it is exceeding. A careful examination of this will help you to avoid fraud.

If there is any doubt, try to reach the customer. If the phone is disconnected, mark it as fraud. If there is no answer, leave a message on the answering machine. Then send an e-mail. If after 24 hours the e-mail and the call are not returned, do not process.