Travel companies need to proactively combat fraud of all types if they want to prevent losses and protect their bottom line.
Tampa Bay, FL (PRWEB) March 31, 2015
Recent travel projections published by Airlines for America (A4A) indicate that spring 2015 air travel will rise to its highest levels since 2007, with 2.2 million passengers flying each day in March and April.(1) While this upsurge in travel may translate to greater profits for airlines, hotels and other travel service providers, it also has the potential to contribute to increased credit card disputes and chargebacks due to the large proportion of card-not-present (CNP) bookings made online or over the phone. Chargebacks911, a leading dispute mitigation and risk management firm, advises travel-industry merchants to promptly address credit card disputes and partner with an experienced mediator to minimize chargebacks and related fees.
Various reports and news stories have spotlighted the high levels of fraud experienced by travel companies, which ranges from identity thieves using stolen credit card information to purchase airline tickets (2) to consumers who file chargebacks as a way to circumvent cancelation fees and non-refundable travel bookings.(3) USA TODAY noted that fraudsters initially targeted online travel-booking services such as Orbitz—“resulting in millions of dollars in lost revenue a month”—before taking aim at airlines, where annual losses were estimated to average $2.4 million per carrier.(2)
Although many travel companies have since implemented stronger fraud-protection measures, identity theft and chargeback fraud—also known as “friendly fraud”—remain an ongoing challenge within the travel sector. The latest estimates suggest that fraudulent online bookings cost the airline industry alone a total of $1 billion annually; recent global efforts to combat that fraud include a November 2014 sting that led to 118 arrests for 281 suspicious transactions across more than 60 airlines in 45 countries.(4) However, criminal fraud only represents a fraction of travel industry losses, which are further compounded by friendly fraud. This is often driven by consumers who agree to non-refundable payments or cancelation fees, decline travel insurance and then seek recourse through chargebacks when their travel plans change or they are affected by delays, missed flights or other issues.
“Travel companies need to proactively combat fraud of all types if they want to prevent losses and protect their bottom line,” explained Monica Eaton-Cardone, co-founder and Chief Operating Officer of Chargebacks911. “While instances of identity-theft credit card fraud tend to get the most media attention, we’ve found that 70% of chargebacks are attributable to friendly fraud, 20% to criminal fraud and 10% to merchant error. Businesses can mitigate losses across all of these areas with an effective chargeback management solution and by partnering with a dispute mediator that specializes in friendly fraud.”
Chargebacks911 supports travel providers and other businesses with a range of services, including pre-chargeback resolution services, dynamic loss prevention, intelligent source detection, affiliate fraud detection, chargeback resolution and response, and merchant education. The company serves merchants and processors throughout the United States, Canada and Europe, and processes more than 150 million transactions each month.
For more information on Chargebacks911 and its risk management solutions, visit http://chargebacks911.com.
About Global Risk Technologies and Chargebacks911:
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 200MM transactions worldwide each month.
Chargebacks911 is a division of Global Risk Technologies, and was developed specifically for merchants to offer immediate aid through proprietary technology and provide the necessary function that gives merchants the freedom to focus on their core competency and optimize their in-house skill set. Chargebacks911 focuses on chargeback mitigation and risk management. They specialize in servicing Internet merchants and acquiring banks, offering dispute response solutions and deep analytics. Chargebacks911 works with their client base to help them keep dispute rates down and retain their ability to accept credit cards. For more information, visit http://www.chargebacks911.com.
1. Airlines for America (A4A). “A4A Projects Spring 2015 Air Travel to Rise to Highest Level in Seven Years”; infographic accompanying A4A press release; March 11, 2015. airlines.org/news/2014-passenger-airline-results-and-2015-spring-air-travel/
2. Jones, Charisse. “Airlines Increase Fight Against Online Ticket Fraud”; USA TODAY; October 5, 2010. usatoday30.usatoday.com/money/industries/travel/2010-10-05-businesstravel05_ST_N.htm
3. UniBul. “How Travel Agencies Can Manage Credit Card Risk”; UniBul blog; March 16, 2010. blog.unibulmerchantservices.com/how-travel-agencies-can-manage-credit-card-risk/
4. Europol. “118 Arrested in Global Action Against Online Fraudsters in the Airline Sector”; Europol press release; November 24, 2014. http://www.europol.europa.eu/content/118-arrested-global-action-against-online-fraudsters-airline-sector