Refunding Fraud

What is Refund Fraud?

The bad dream of malicious friendly fraud has morphed into a new nightmare: refunding fraud. Picture this, a professional fraudster advertises to consumers to help them steal from merchants like you—without the uncomfortable work of calling customer service and lying to your representatives—all for a percentage fee. We are now in the age of the industrialization of friendly fraud, fraud-as-a-service.

These bad actors have researched your refunding policies and know every minute detail. They just need a willing accomplice to place the order. You refund the payment, the accomplice gets your product for free and pays a small fee to the fraudster for doing the legwork. And, they can accomplish this theft quickly and repeat the process over and over again without detection.

SHORTCUTS:

  1. Webinar | Fraud-as-a-Service: Refunding Fraud, Merchants’ New Nightmare
  2. Merchant Guide | 7 Steps to Stop Refunding Fraud
  3. Article | Refunding Fraud: The Industrialization of Friendly Fraud
  4. Article | Returns and Refunding Fraud Costing Merchants Millions
  5. Article | The New Year Threat: Revamped Refund Fraud
  6. Article | Refund Fraud: An Update
  7. Article | Refund Fraud Catches Mainstream Attention

 

 

Fraud-as-a-Service: Refunding Fraud

Fraud-as-a-Service: Refunding Fraud, Merchants’ New Nightmare

The bad dream of malicious friendly fraud has morphed into a new nightmare: refunding fraud. Picture this, a professional fraudster advertises to consumers to help them steal from merchants like you—without the uncomfortable work of calling customer service and lying to your representatives—all for a percentage fee. We are now in the age of the industrialization of friendly fraud, fraud-as-a-service.

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Refunding Fraud Merchant Guide

7 Steps to Stop Refunding Fraud | Merchant Guide

Get our FREE CNP Merchant Guide to learn:
  • What refunding fraud is and
  • How these new schemes by professional fraudsters work
  • Which scripts bad actors use to hack your customer service agents
  • Why the attacks are difficult to identify
  • How you can find and stop refunding fraud today

 

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Refund Fraud Article 1

Refunding Fraud: The Industrialization of Friendly Fraud

By Karisse Hendrick, Principal, Chargelytics Consulting

In the last year, retailers have been reporting an increase in “Item Not Received” (INR) or “Did Not Receive” (DNR) claims they couldn’t explain. While they have seen some of these claims result in chargebacks, primarily this increase has occurred via...

 

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Returns and Refunding Fraud

Returns and Refunding Fraud Costing Merchants Millions

Merchants are losing massive amounts of revenue annually because of returns abuse and fraud. New research from Forter claims 54 percent of merchants lost revenues of $5 million or more annually because consumers or professional fraudsters are taking advantage of vulnerabilities in their return policies for online purchases.

The survey also notes about 20 percent of returns are categorized as fraudulent or abusive. It is a growing problem as returns abuse rose by...

 

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Refund Fraud

The New Year Threat: Revamped Refund Fraud

A new year has begun, and we’re all hoping for one that’s easier and less chaotic than the previous one. But for many merchants, the early months of the new year come with some serious refund stress, as customers rush to swap the gifts they’ve received for items, cash or credit they actually want. Some will also be making sure they’re not out of pocket after suffering from porch piracy...

 

 

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Refund Fraud: An Update

Refund Fraud: An Update

The impact of refund fraud has only increased in the months since we first discovered this frightening new fraud trend. While refunders began by targeting the largest brands in the world, they have turned their attention toward smaller businesses as well. The companies most often targeted for this type of attack are retailers with physical goods, delivery companies, and restaurants offering curbside or to-go order pickups...

 

 

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Refund Fraud Catches Mainstream Attention

Refund Fraud involves professional fraudsters who become intimately familiar with the return policies of online retailers. For a fee, they help regular consumers navigate the process of making a purchase and initiating a return for a product they know the retailer will not ask them to send back—a type of supercharged friendly fraud enabling consumers to keep a product they ordered and get a refund simultaneously, without initiating a chargeback...

 

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