Considering the billions lost to credit card fraud and chargebacks each year, it becomes evident those losses are going to trickle down to consumers in one form or another.
Tampa Bay, FL (PRWEB) January 20, 2015
As the costs of credit card chargebacks and fraud have continued to climb, merchants and credit card issuers have begun passing their expenses down to consumers. To help consumers prevent these trickle-down price increases and fees, Gary Cardone — CEO of the transaction dispute practice eConsumerServices — shares his top 10 tips for preventing chargebacks and fraud.
According to a LexisNexis study, existing card fraud (ECF) accounted for $11.1 billion in losses in 2013, while account takeover (ATO) fraud – which occurs when occurs when a fraudster obtains an individual’s personal information and makes changes to an existing account – resulted in $4.7 billion in losses over the same period (1). On top of that, Visa estimated that fraudulent chargebacks made by consumers — a practice known as “friendly fraud” or “cyber shoplifting” — translated to $11.8 billion in losses (2).
“Considering the billions lost to credit card fraud and chargebacks each year, it becomes evident those losses are going to trickle down to consumers in one form or another,” said Gary Cardone, CEO of eConsumerServices. “Some consumers ignore fraud risks knowing they have ‘zero liability’ for unauthorized purchases, and many don’t think twice about filing a chargeback. But if they were aware these costs are being passed down to them through increased prices and fees, I think they’d take action to prevent them.”
Here, Cardone shares his top 10 tips to help consumers avoid identity theft, chargebacks and friendly fraud:
1. Shred all documents containing personal account information. Never throw bank statements, bills or similar documents in the trash or recycling bin; always shred them to prevent identity thieves from gaining access to your account details. And when possible, opt for paperless billing/statements.
2. Change passwords following a data breach. If you are notified that a company you’ve done business with has had a data breach, change your password immediately rather than waiting to see if any fraudulent transactions show up on your account.
3. Use strong passwords. Maintain strong passwords on your financial accounts as well as online shopping websites, using a combination of upper and lowercase letters, numbers and symbols. And use different passwords for every site so that if one password is compromised, the rest will remain safe.
4. Monitor your accounts. Check your credit card and bank accounts regularly for unauthorized charges. If you see a charge for a purchase you did not make, contact the merchant and your credit card provider or bank immediately. If they do not remove the charge, submit a transaction dispute claim.
5. Beware of recurring charges. Always read the fine print before signing up for a free trial or specially priced subscription; these offers often renew automatically, and often at a higher rate. If you have difficulty cancelling a recurring subscription, enlist the help of a dispute mediation service rather than initiating a chargeback.
6. Register with online retailers. When you place an order online, register for a free account with the merchant rather than checking out as a guest. This can make it easier to track to the status of your order and contact the merchant if you have questions or problems with the order.
7. Review return policies. Before you place an order with an online merchant, always check the return policy. Many merchants provide return instructions and even prepaid return labels with each order, so be sure to save the paperwork and original packaging.
8. Prevent stolen packages. Take care when choosing your shipping address and delivery method to avoid having packages left outside your home. Use package tracking to check delivery status, and make arrangements to have a package held or picked up by a neighbor when you’re away. If a shipment is not delivered, contact the merchant or a transaction dispute service before filing a chargeback.
9. Allow the merchant to make things right. If you’re unhappy with a product or service, always contact the merchant first before attempting a chargeback. Most merchants are committed to customer satisfaction, and you can often resolve the matter with a single phone or email.
10. Make chargebacks a last resort. Not only are chargeback costs likely to be passed down to consumers, but chargeback refunds can take up to 60 days to investigate and process. Furthermore, individuals who frequently file chargebacks may potentially be flagged and investigated for friendly fraud.
Cardone maintains that the above tips can help consumers take a proactive role in minimizing the trickle-down costs of fraud and chargebacks. If a merchant denies a refund, credit card dispute mediation offers a better alternative to chargebacks.
eConsumerServices can facilitate a refund in a matter of hours or days, as opposed to weeks or months for a chargeback. For more information on eConsumerServices and its transaction mediation services, visit http://www.econsumerservices.com.
About Global Risk Technologies and eConsumerServices:
Global Risk Technologies is most known for its role in payment processing solutions that cater to each side of the value chain: Chargebacks911.com and eConsumerServices.com. The firm is headquartered in Tampa Bay, Florida, with offices in Ireland and Atlanta. They have approximately 350 employees worldwide, and currently manage over 150MM in transactions each month, with clients located in the U.S. and Europe.
eConsumerServices focuses on the cardholder or consumer in order to encourage transactional resolution before it progresses to a chargeback. The company caters to the B2C (business-to-consumer) sector of Global’s initiative, in working to realize greater standardization and increased efficiency within the payments industry. eConsumerServices is an online mediation service that works to effectively and efficiently resolve transaction issues between merchants, consumers and banks. For more information, visit http://www.eConsumerServices.com.
1. LexisNexis. “2014 LexisNexis True Cost of Fraud Study”; August 2014; accessed January 12, 2015. lexisnexis.com/risk/downloads/assets/true-cost-fraud-2014.pdf
2. Harper, Elizabeth. “‘I Didn’t Buy That’: Friendly Fraud Costs Retailers $11.8 Billion a Year”; DailyFinance; March 20, 2014; accessed January 12, 2015. dailyfinance.com/2014/03/20/friendly-fraud-costs-retailers-billions/