Don’t Count on Fraudsters Taking a Break – Preparing for Fraud Over The Holidays

For most online merchants the holiday seasons are among the busiest – either because of last minute shoppers or as people rest while using online services.

This is why the season is busy for a less liked cohort as well: cybercriminals, who know very well that businesses are understaffed and overwhelmed and will use the opportunity to try and defraud them.

In this webinar the subject is: what can you do to prepare your staff and procedures to fend off the threats without implementing expensive software tools?

Our goal is to share our industry insights to give you actionable steps you can take in advance to make the best out of the busiest season. Improve your defences, manage your workload all without introducing additional churn.

Agenda

• Common angles of attack during the holidays
• Preparing your team – drills and procedures
• Multi-level risk and fraud checks
• Getting more out of your data

Speakers

• Alexander Hall, Founder, Dispute Defense Consulting
• Gergo Varga, Senior Content Manager and Ex-Fraud Analyst, SEON
• Balint Patkos, Head of Customer Success, SEON

The host was our Co-founder and COO, Bence Jendruszak.

Key takeaways 

Fraudsters Are Educated

“Fraudsters are just normal people as well and in the last decade, it’s become so normalized to spend time on the internet even when you’re on holiday. Fraudsters will use and abuse to hide within the mass amounts of traffic but also your company might be understaffed because of the holiday. They tend to know your business hours, and your fulfillment time will be faster so if an order is placed at the right time, your team can easily miss it. Fraudsters have the same mindset as burglars – understanding your weak spots and how to expose them,” – Gergo Varga.

“Gift cards were always something that was profitable for my operations [as a fraudster]. In one holiday season, we could pull in $15,000-$30,000 just in gift cards. There are a lot of different attacks which can be exploited in the holidays season and that’s why using expansive data sets is so important to help accurate determinations without adding friction,” – Alexander Hall.

Chargeback Abuse and Fraudster Numbers Ramp Up 

“The best way to handle chargebacks is by being fully prepared with your data. Be willing to go into different places, go to Facebook and see if you can find them posing with the product for example. Methods like this are proving to have a big impact on chargeback abuse. The pandemic has given people the opportunity to learn about how to abuse systems, previously honest consumers have been put into difficult positions and now understand how they can receive goods for free. 

“To help this, make sure your terms and conditions are clearly written out that cannot be contested, and follow up on your fulfillments or something similar to create that acknowledgment from them that the goods have been received. For higher valued items, look at signed deliveries perhaps or another method to help reinforce your message when presenting against a chargeback case,” – Alexander Hall. 

“Both friendly fraud and chargeback fraud as well as item not received claims are more frequent during the holiday season. With the varying regulations in each country, it’s tough for merchants and fraudsters can easily get away with free goods. 

“You have to consider that fraud is very popular in certain countries and often there’s next to no repercussions from authorities so to protect your business, changing your ruleset to highlight riskier countries can help create a better defense,” – Balint Patkos.

Rule of Three: Automation, Education…

“Given the increase in traffic and velocity, fraudsters are aware of the potential lapses in security so a lot of new methods will come in that might not work throughout the year. What I enforce is the idea of stringency with the training coming into the holiday season. With eCommerce as well, it’s really important to leverage both historical data and from providers to really understand the story beneath the data.

“Always consider the difference in behavioral shopping habits between holiday shoppers and fraudsters and shipping addresses as well can be a huge indicator of fraud, look to see if what address has been associated with other suspicious activity. Fraudsters won’t have endless shipping addresses available to use.” – Alexander Hall.

“You are working with since the ratio of manual reviews is much lower it’s important to utilize machine learning as much as possible. Multiple fraud groups might attack the same business with different tactics and it can trigger more of your complex velocity rules, reacting to these triggers in a timely manner is extremely important.” – Balint Patkos.

and Affection? Care For Your Fraud Fighters!!

“Once we went from a five-man shift to a two-man team in the holidays so the company I worked for prepared dinner for us and quite simply looked after us. This gives your workers real motivation as this way your time is valued. Of course, education is important as well as using the best resources available, but keeping your team motivated during this period is arguably more important,” – Balint Patkos.