Even when you do business with only domestic customers, it is vital that you securely process payments of all types. If possible, this priority becomes even more crucial when you enter the global marketplace. That’s why it is important to come up with a cross-border ecommerce plan that takes tangible steps to reduce the fraud and other cyber crimes that can deal a fatal blow to your brand.

Ecommerce fraud defined.

Transaction fees aren’t the only potentially surprising elements to be on the lookout for when you set up your international business. You probably won’t be shocked to learn that criminals have found ways to cash in on the security leaks that can so easily happen when people sell products internationally. Ecommerce fraud is a term that refers to a criminal act in which scammers intercept a commercial transaction, stealing money from the shopper, the merchant. or both. There are several types of ecommerce fraud that international sellers can experience.

• Friendly fraud. Although the customer does buy something from you, they then ask their credit card company for a refund. They might say the item was not delivered, claim that they canceled or state that the merchandise does not appear as advertised. In the end, it costs you both time and money to fight the chargeback.
• Card testing. Scammers make a small purchase on a stolen card that goes undetected by the rightful holder. They then make more expensive buys.
• Refund. People return stolen or damaged items for a refund.
• Online payment fraud. Scammers steal someone’s payment details and then make a purchase on your site. Criminals sometimes also make clones of your website and then encourage customers to make legitimate purchases there.
• Account takeover fraud. This happens if scammers break into someone’s online account through phishing schemes, weak passwords, or malicious software and then use the details to make purchases.
• Affiliate, loyalty program or promotion fraud. This can be done by referring illegitimate customers, selling loyalty card points on the dark web, or finding loopholes in your product promotions that allow scammers to get things for free.
• Triangulation fraud. Criminals list your products on a valid site like Amazon at an appealing discount. Seeing a lower price, a customer purchases them. Although the buyer receives the goods, their credit card information is compromised and is later used by scammers for their own purposes.

Each of these types of fraud leads to added expense, stress and time for customers and merchants alike. If you don’t protect your site from fraud in a way that is as robust as possible, your global ecommerce company as well as your customers will suffer.

Red flags.

Although cyber crime can sometimes be hard to spot, there are certain telltale signs. Be sure that you and your staff watch for the following suspicious signals.

• Ordering large quantities of merchandise or high-ticket items.
• Extremely low-value purchases. This might be a sign of card testing fraud.
• A single customer uses several credit cards to make their purchases.
• Repeated declined transactions.
• Unfamiliar IP addresses or several orders from the same one.
• Different shipping and billing addresses.
• Shipping to post office boxes.

While picking up on one or more of these phenomena does not always mean that a customer is trying to scam you, they definitely merit further investigation on your part.

Ways to prevent international ecommerce fraud.

In addition to being proactive, there are effective steps you can take if you suspect fraud. These include the following.

• If an order looks suspicious, manually review it. Contact the customer by phone or email for added verification.
• Limit order quantities, particularly for new customers. You can do this by using your sales software to analyze historical sales data. You will then learn the volumes that are typically bought by the average customer to come up with an acceptable threshold.
• Configure your system to require proof of delivery. Only work with trustworthy shippers and suppliers.
• Securely process payments. Your website should be in compliance with the Payment Card Industry Data Security Standard (PCI DSS) as well as follow all regulations pertaining to your particular industry. PCI DSS mandates that you change software and systems default passwords, encrypt cardholder data on open or public networks, use antivirus software, restrict employee access to cardholder data, and regularly test your systems security.
• Be particularly watchful during busy times of the year. Fraudsters often try to take advantage of the holiday rush in hopes that their criminal activities will go undetected until it is too late.
• Prominently and clearly display all shipping, delivery, returns and exchanges, and loyalty program/promotions policies on your website. If your customers speak other languages, hire someone to translate everything clearly. This is not a time to rely on an automated program to do the job. There are too many linguistic and cultural nuances.
• Use software that verifies addresses and card verification numbers.
• Use protocols such as 3-D Secure to provide an extra layer of authentication.
• Build and maintain a list of blocked customers that includes names, credit card numbers, IP addresses, and shipping addresses.
• Use IP fraud scoring tools. Serial cyber criminals often use the same computer to commit multiple frauds. These tools look at an IP address to detect whether it has been associated with fraud in the past. The software then gives that particular purchase a high score and flags it so that you can manually review the transaction.

Whether you are talking about domestic or international cyber crimes, one old adage continues to hold true: Scammers will generally pick the lowest-hanging fruit. The more you actively work to securely process payments and protect your site from fraud, the less likely you will be the next victim.

Particularly with global-facing companies like yours, earning and keeping customer trust is an absolute requirement. Instituting the above measures and making an active commitment to full transparency and clarity will go a long way toward helping you to cultivate and keep the valued international buyers that will spell success for your company.