Protecting your business from fraudulent transactions over the festive season

By Cerri Killworth, NetPay Merchant Services Ireland Limited

Retail Ireland, a branch of business group IBEC expecting spending to reach €4.05 billion and, over the Black Friday and Cyber Weekend.

Retailers are busy preparing themselves for this bumper weekend and ensuring that they have enough stock to fulfil orders. But what about checking whether the orders that they are dispatching are for genuine customers? That should be at the top of their Christmas list.

It is estimated that the Irish economy is set to lose up to €500m a year by 2016 to online fraud with the cost to an individual online business being €90,000 a year.[1]

Card fraud can quickly turn a prosperous holiday season into a nightmare for businesses and, for some unlucky ones; it could even mean that they have to shut up shop for good.

What happens if an order is fake?

Each time an unauthorised card transaction occurs, the business is liable for a charge back fee. This means that a business not only loses the value of the order and the actual goods if they have already been dispatched, but it is also charged a fee for the fraudulent order, even though it is not the businesses fault.

How to spot a fake order?

Here are some things to add to your processing check list to identify the legitimacy of an order:

  • Is the sale excessively high in comparison to your usual orders?
  • Does the address provided seem suspicious?
  • Has the delivery address been used before with different customer details?
  • Is the customer attempting to use more than one card in order to split the value of the sale?
  • Does the billing address match the information on file with the credit card company?
  • Is it a rush orders for large quantities or high-value items? Fraudsters may ask to have an order shipped overnight, so they know exactly what day the order will arrive and they can be waiting to pick it up
  • Is the order to be shipped to a different address than the billing address?

How to protect your business from Online Fraud?

If you are selling your goods and services online, then it is important to ensure that your online system is PCI compliant and uses 3D secure to provide an extra level of security.

The PCI Compliance Standard is mandated by the card brands (Visa, MasterCard and American Express) and run by the Payment Card Industry Security Standards Council. The standard was created to increase controls around cardholder data to reduce credit card fraud.

The 3D Secure authentication is an additional fraud prevention scheme, allowing shoppers to create and assign a password to their card, that is then verified whenever a transaction is processed. The addition of password protection allows extra security on transactions that are processed online.

If you are still unsure about whether an order is genuine, then check the Industry Hot Card File to see if the card is registered.

Remember you have the right to decline the order. If you suspect the transaction to be fraudulent, make every effort to try and contact the customer and verify their details before making your decision.


[1] Source: Retail Excellence Ireland –

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