How To Spot A Fraudster
Retail Decisions says there is a swelling army of invisible thieves, perhaps the worst kind, who are pillaging online merchants via stolen credit and debit card information. Criminals use stolen credit and debit card information to fraudulently purchase items for resale.
According to Retail Decisions (ReD), a world leader in card fraud prevention and payment processing, during holiday season 2006, online purchasing activity is predicted to peak for major retailers, December 11th, between 2:00PM and 3:00PM EST. If Black Friday was an early indication of how the number of transactions and volume of sales will increase, ReD is expecting to identify and stop greater volumes of attempted fraud this year. On a like for like basis, ReD saw volumes increase by 109% on Black Friday for its U.S. clients. Unfortunately, merchants without a sophisticated fraud prevention system will see fraudulent product purchases skyrocket."Through our global fraud prevention services and payment processing, we record and analyze a significant portion of online purchases from some of the world's largest retailers." said Carl Clump, CEO of Retail Decisions. "Each year, we analyze our data to provide trends for online purchase activity. We now have a good idea of the items that will be targeted by fraudsters during the 2006 holiday season."
The top categories of products purchased fraudulently during 2006 up to Black Friday, were gift cards, electronics, tools, jewelry and apparel.
By way of an example, attempted fraudulent transactions for one online mass merchant in November included 930 tool sets (valued at total $32,836), 738 gift cards (valued at total $26,895), 70 home theatres (valued at total $22,986) and 58 LCD widescreens at $59,983 total value. 89% of attempted fraudulent purchases were below $1000.
How to spot a Fraudster
Fraudsters typically:
ReD's fraud prevention service maximizes the number of transactions that can be safely accepted whilst minimizing the consumer's and retailer's exposure to fraudulent transactions. Some of ReD's clients include, Federated Department Stores, Walmart.com, Travelocity, and The Finish Line, Inc.
- Use free email domains,
- Are urban dwellers
- Want their items quickly - 56% of fraudulent orders are next day or two day delivery whereas only nine percent of genuine customers ask for next day delivery online.
- Spend 2.5 times more than genuine consumer
- Bundle their purchases with an average of four items at a time; legitimate customers typically purchase one or two items per transaction.
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