Like thieves who target brick-and-mortar offices, online thieves are often bold, going about their fraudulent business without fear of being caught red-handed. Online high-risk merchants are susceptible to credit card fraud and other forms of identity theft that result in costly chargebacks to their high-volume merchant accounts.
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Is there nothing that these businesses can do to reduce the number of fraudulent transactions that occur during their everyday transactions? Thankfully, there are some clear steps high-risk merchants can take to significantly ward off would-be thieves:
Check the address: Although many online merchants would like to be able to offer their customers the convenience of providing a "gift address" for a particular sale, the reality is this is just too risky. Many thieves will use this opportunity to use a stolen credit card because they can simply put down their own address for the shipping address rather than the actual billing address for the card.
Today's merchants are learning to require shipping to only the billing address of the credit card used for the sale. Another step many merchants are taking is to use the Address Verification Service (AVS) to verify that the address given by the customer is the actual billing address for the card.
As the AVS usually cannot verify international addresses, many online merchants will not deliver out of the country. Finally, many merchants have a policy of only delivering products to a street address rather than a P.O. Box, further reducing the number of chargebacks due to fraud.
Verify orders: High-risk merchants also scare off would-be thieves by posting a policy of verifying orders over the telephone. These wise business owners have learned that most customers who are using a stolen credit card do not want to talk to an actual person during a fraudulent sale.
Usually, it is enough to post the warning; very few merchants actually make many of these phone calls. Even a normally high-volume merchant account has learned to pay close attention to orders of strikingly high volume, as these orders may be a minor who is making purchases without permission or a thief who is using someone else's money. A quick phone call can usually clear up any suspicious activity.