The dumpster industry is facing increased chargebacks and fraudulent transactions currently. This is a big issue for those affected, since it represents a loss of income outside of your control largely driven by bad actors when you did everything you are supposed to do.
This is a difficult challenge to overcome - these individuals are well organized and have all of the payment information required to make the transaction look legitimate, and the issue is that these transactions will result in a chargeback within 4 months and it is nearly impossible for you as the business owner to win this chargeback.
We have reviewed transactions that have resulted in a chargeback, and are excited to release the first feature designed to help you protect your business against this issue.
Since this is such a complex issue, this tool is never going to fully protect you and identify all suspicious transactions. Also if a transaction is highlighted as a risky transaction, it does not definitively mean it is. This is just us raising a flag for you to dig in further.
After reviewing the chargebacks we have seen across the portfolio, we found that they share a number of customer behaviors which we have used to create this risk flag system. High level, here are some of the factors we are taking into account:
- International IP used for order/payment
- Different billing and service address
- Multiple orders for the same customer across different billing addresses
- Multiple orders across multiple shopping carts
- Customer name is different than billing name
- Out of state billing address
- Non local contact phone number
- Short order timeline - next day delivery etc
All of these factors could be completely innocent - there are legitimate reasons why customers would hit any individual or even all of these factors - however, it is suspicious and deserves more digging into.
Our system consolidates these factors, and if enough of them are hit we will mark the invoice / payment as "medium" or "high risk" depending on the number of factors. You will be able to see these on the invoice page like this:
Once we have identified a transaction as risky, this is where you are going to be the best defense. The transaction has gone through, we will not hold or decline transactions based on these factors so as to not affect legitimate customers. Working out if these are a high chargeback risk for fraud is something we cannot code into the software, it needs a human touch.
If a transaction is marked as a risky transaction, the best thing to do is to dig into it. This will take a little bit of work from your team, but will go a long way to protecting your business and its income.By hovering over the risk - your team can see what factors came into effect
The best action you can take is to call the customer, and ask them about the discrepancies.
- Did they place the order using a "broker"? If so, who/how did they find this broker?
- Why is the card under a different name? Can they provide the ID for the cardholder?
- Where are you currently located?
- Why are they making multiple orders for multiple customers?
- Are they traveling currently?
- Can they explain who "card holder name" is
The goal of these questions is to suss out if this person is legitimate or not, this will be your call since this is your business. Use your best judgement, but proceed with caution. Some of these factors are likely more of a red flag than others (international IP being the highest) but its up to you to decide if this customer feels right.
If something feels off during the conversation, don't be afraid to request a different method of payment or request to meet them at the property with the card and ID in hand. Ultimately, if you believe it is fraud, cancel the order and refund the transaction.