Help & Support / Information
and Guides / <<
back to previous page
Combating and stopping
Friendly fraud (we personally hate this industry term
as there is nothing 'friendly' about it) happens when
a customer makes a credit card payment with their
own card and then issues
a chargeback through the card provider after receiving
the goods or services with the aim for getting them
for free (in other words, theft!) or because they
fear that their bank statement may be read by someone
else and they get into trouble (as is often the case
in the adult industry)
That said... sometimes 'friendly fraud' happens when
a customer is confused and forgets who they have purchased
from. Luckily confused customers are easy to deal
with. Please see below:
"Friendly" fraud differs from online
fraud committed by criminals using stolen credit
cards. The challenge with friendly fraud is that there
is no way to verify the authenticity of the actual transaction,
which is in fact legitimate. We
find that this happens more with higher risk merchants
and also adult ones.
You can’t completely stop “friendly
fraud” but you can implement measures to combat
help stop friendly fraud (and help confused
Good customer service
The easier it is for customers
to contact you and speak to a real human being,
the less likely they are to resort to chargebacks.
Confirm what they have
purchased and where it will be delivered
Always provide a order confirmation
page showing the details of the purchase. This
should include your company name, what they purchased,
their billing and delivery address and how to
contact you. It is also a good idea to provide
the descriptor that will appear on their card
or bank statement - this is especially so for
payment services where by you share a descriptor.
Email them when you have received
an order and shipped it out. Contact them back
straight away if they contact you. Email is the
best way to communicate as it provides proof.
Have a good refund policy
A good refund policy is essential.
It spells out exactly how a customer can be refunded
and how they need to go about it. Make it up front
and easy to find
Provide terms and conditions
and make them easily accessible
All terms and conditions need to be clearly stated
on all pages of the website. You should include
your cancellation and return policy. Making the
customer to “Check the Box” as part
of the agreement is also recommended.
Save as much information
Collect and store as much information
on the customer as well as the order as you can.
This will allow you to show that they did indeed
buy from you knowingly.
Use 3D secure and other
This forces the consumer to take
extra steps to validate their identity at the
time of the sale which can defer them from committing
“friendly fraud” later on.
Get a signature whenever
Proof of signature is ideal as
it stops a customer from using the excuse that
they did not get the item.
Whether you own a high street business or an online
one, having to deal with people trying to steal from
you is all part of running a business. You may not be
able to use guards and alarms like you can with a high
street shop, but you can follow these steps to help
Use your own data against them
Using your own data to prevent
chargebacks is a very effective way to stop a thief
from coming back and striking again.
Unfortunately, merchants often
don’t Blacklist the users that did a chargeback
allowing new transactions to go through. Many gateways
and processors offer this service for free to their
merchants. They take the data from all of the merchants
on their systems and use it to create a master blacklist.
So even if the merchant did a chargeback with a different
merchant you may be protected.