Fraudulent Orders in a Busy Week

The timing is not coincidental

A shop in a normal week looks at each order and notices the odd one.

The same shop in the second week of December is processing at speed, with temporary help, and everybody's attention is on getting parcels out.

That is when checks get skipped, and it is when the orders that would not survive a check arrive.

Which means the useful preparation is deciding the rules now, while there is time to think, rather than making judgements at speed later.

The signals worth watching

• Billing and delivery in different places.
• Express shipping on an ordinary item.
• A large first order from a new customer.
• Several cards tried on one order.
• Quantities nobody buys personally.
• An address that has been used before with a different name.

No single one of those means anything, since gift orders explain the first, urgency explains the second, and a genuine customer can trip several. Two or three together is what justifies a look.

Why rush shipping matters

Worth explaining, since it is the strongest single signal and looks like an ordinary preference.

Somebody using a card that is not theirs is racing the moment the real cardholder notices.

So they pay for the fastest delivery available, on items where nobody would normally bother, because the goods have to arrive before the card is stopped.

Combined with a delivery address that does not match the card, that is the classic pattern and it is worth a check every time.

The same reasoning explains why fraudulent orders are placed at odd hours and why the customer is unusually responsive to messages about dispatch.

Hold, do not cancel

The response that costs least when you are wrong.

Cancelling a legitimate order accuses a real customer of fraud, which is remembered and occasionally shared publicly.

Holding it for a check costs a day and offends nobody, particularly if you say the order is held for verification and will ship as soon as it clears.

Telephone the number on the order, which is the single most effective check available: a genuine customer answers and confirms, and a fraudulent one frequently does not answer at all.

Where the number is unreachable and the pattern is strong, refunding rather than dispatching is the safe outcome.

Refunding is also considerably cheaper than a chargeback, since you keep the goods and avoid the fee.

A worked example

A shop received an order in early December for six of the same item, express delivery, to an address in another province, on a card registered elsewhere.

It was the customer's first order and the value was several times their average.

They held it and telephoned the number provided, which did not connect.

They emailed asking to confirm the billing address and received no reply, then refunded the order after two days.

A chargeback arrived a fortnight later for a different order that had been dispatched the same week, which they had not held.

The held order cost them a phone call and the dispatched one cost them the goods, the shipping, and the fee.

Write the rules down now

So that somebody else can apply them in December.

Decide the value above which every order gets a look, and what two signals together mean a hold.

Say who makes the decision when the owner is unavailable, since that is exactly when these arrive.

Write the verification message and the hold message in advance, so they are sent promptly and read well.

And say what happens to a held order that nobody has resolved by the end of the next day, since an order sitting unresolved is a decision by default.

A page of rules means a temporary member of staff can flag rather than dispatch, which is the whole benefit.

Use what the provider gives you

Since most of this is already being assessed automatically.

Payment providers score transactions for risk and will show you the score and the reasons if you look.

Many can also hold or flag orders above a threshold automatically, which is a setting rather than a process.

Turn on whatever review queue exists rather than relying on somebody noticing, because in a busy week nobody notices.

And check the queue at fixed times daily rather than continuously, so it does not become another interruption.

Losing the goods is only part of it

Worth understanding when weighing how much effort this deserves.

A fraudulent order that ships costs the goods, the shipping, the chargeback fee, and the staff time to answer it.

It also raises your chargeback ratio, which is the figure your payment provider watches and which triggers reserves and reviews.

So several in a busy month can cost you the ability to take payments normally, which is far more expensive than the parcels.

That is the argument for spending twenty minutes a day on this during the peak rather than treating it as an acceptable loss.

Tell staff what to do, not what to spot

A distinction that matters when temporary help is involved.

Asking somebody to watch for suspicious orders puts a judgement on a person who has been in the job a fortnight and does not know what normal looks like.

Give them a rule instead: any order over this amount, or going to a different province, gets set aside rather than packed.

A rule can be followed at speed by anybody and produces a small pile for somebody experienced to look at once a day.

That is also fairer to the person, since being told to use their judgement and then blamed for a missed order is the version that makes people stop flagging anything.

The counter-case

Over-screening is expensive too.

Most unusual orders are legitimate, and December is full of people buying for other people at other addresses in a hurry.

A shop that holds every gift order will delay a great many genuine customers at the worst possible moment.

And the checks take time you do not have, which is why the rules have to be narrow enough to apply to a handful of orders rather than to a category.

Set a value threshold, look for two signals together, hold rather than cancel, and telephone the number.

Before the peak

1. Set a value threshold for a look.
2. Define what two signals together mean.
3. Turn on the provider's review queue.
4. Write the hold message in advance.
5. Telephone the number on suspect orders.
6. Refund rather than dispatch when unresolved.
7. Say who decides when you are unavailable.

Step five settles most cases in a minute, and it is the check most shops skip because a telephone call feels disproportionate until the chargeback arrives.

The version where your own site is the source is covered in a customer told you their card was cloned.

Frequently asked questions

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