Cybercrimes has been on the rise, especially with the rising development of technology. Fraudulent transactions can be expensive, especially for the part or the business owner. The good thing is, you can spot and stop a fraudulent transaction before it ruins your business.
Here are a few signs of a fraudulent transaction
Incompatible information
Email does not match the name
One of the easiest ways to identify suspicious order is by looking at the customer information. If the email address does not match their name, it could be an issue for the business. Not that this is not always the case.
For valid online transactions email addresses usually resemble the names of the buyer in majority of the purchases. To verify this, email the client/potential customer. If they answer back then it is likely they are legitimate. This is because scammers and fraudsters normally use fake or stolen email for such purchase.
Phone code is not consistent with address
It makes no sense for a customer in the United States for instance to shop with a phone number whose country code is on an entirely different continent. It could be a mistake by the client when filling out the address or you could be dealing with actual fraudsters.
Billing and shipping addresses do not match
Enquire from your client why the billing address is different from their shipping address. It could be that they are buying a gift for family or friends. Worst case scenario, you are dealing with a fraudster client in your business.
Separate orders from the same IP address
Online payment gateways tend to capture the IP address whenever a client makes a transaction. You need to reviews the customer IP information regularly. This way, you can spot when customers put different location information but have an entirely different IP address.
Repetitive orders
It is not uncommon for customers to make two similar orders withing a small-time frame. Its usually because they forgot to purchase an item or want to split up the charges. However, fraudulent customers will try to use the same card to make repetitive orders within a short time frame. This is usually a sign of fraudulent activity. The person might be trying to launder money through your business or may want to request for a chargeback and this may lead to financial loss on your side.
New clients placing large orders/purchasing high priced merch
Here is where your business invoice comes in handy. If you are used to small order purchases, large orders from new customers should be a red flag. Clients are usually very careful about purchasing online, especially if it is their first time. Extremely large orders from new clients, especially ones that created the account just recently is a sign of fraud. For instance, if you receive a daily average of $80 per customer, and one particular day you get a client trying to purchase orders worth $100 or more, this might be a cause for concern.
In this case, the scammers or fraudsters are trying to use illegal money or stolen identity to make a huge-one-time purchase before you block them from the site. Also, modern credit card tech enables online businesses to detect account takeover fraud easily. So, the scammers understand that they are moments away from being caught so they try to get the most out of that card.
Declined transactions
Declined transactions are common in business and not something to worry about. However, issue arises when you get multiple declined transactions from the same client. This is mostly an indicator of fraudulent activity.
Suspicious international/overseas orders
As a small business, it will be hard to recover from international fraud. For this reason, you need to watch out for strange international shipments. Shipping to new countries or regions is great for small online businesses because it means your business is expanding.
If you run your business well, you know which other countries or regions you shop to. A chain or orders, small or large, from a country you have never operated before should not be taken lightly.
Some fraudsters will place an order from abroad and ship it domestically. The order is taken to a place withing your business’ region and later shipped out of the country to make cash transaction hard to track.
