FRAUD PROTECTION

Fraud caused an estimated $400 MILLION
in 2002 in charge back fees in 2002 alone.

Managing revenue & risk

Credit card and bank account fraud can lead to losses that can often be insurmountable for mail order/telephone order (MOTO) merchants to recover from. When consumers dispute charges or charge back for items purchased, merchants are liable. In addition, merchants are responsible for bank chargeback fees and other costs associated with bad transactions. In fact, merchants with excessive chargebacks can even lose the right to accept credit cards - a risk no merchant can afford to take.

• When communicating with your customers at any time during the sales cycle, ensure that the information you provide is as accurate and understandable as possible. Being upfront with the information will allow you to fulfill the expectations of your consumer, who understands what they are purchasing.
• If you are selling your product by phone, it is always beneficial, especially in the long run, to have
  another agent or supervisor reiterate the information relating to the sale. This will allow for the verification of inclusions, warranty information, return policies, and to meet all the legal requirements for processing the payment over the phone.
• When advertising or providing information on your product, your customer service hours should be included. In addition, maintaining an adequate number of trained customer service staff to answer inquiries will minimize chargebacks and disputes.
• When shipping goods, use traceable shipping methods that require a signature by the recipient. This will be helpful when addressing claims that the consumer did not receive the merchandise.
• When providing customer service, a toll-free number is obviously more attractive to consumers who want to inquire about your product or service. This is even more applicable when selling items of lower value. A customer who does not want to pay for long distance charges may instead decide to dispute the charge.
• Posting or providing sales literature, warranty information, and customer service contact information both during and after the sale will provide customers an easy way to contact you with questions or concerns. Not making this information readily available may lead
  to unnecessary chargebacks or disputes that could have been settled easily.
• When selling hard goods, a 14-day return policy is acceptable, however, for non-tangible goods or services, including service or information packages, a liberal return policy will allow consumers to receive, open, try, and test the product. This will minimize returns of the product.
• When issuing credits for refunds, issue the credits as soon as possible, and advise the consumer that it may take up to 5 business days for the refund to appear on their credit card statement or in their bank account.
• If and when you do get a chargeback, we suggest that you call the customer to find out the reason. Typical reasons that can be managed include billing the customer an incorrect amount, goods not received as advertised, or poor customer assistance when tracking the delivery. In many cases when a consumer's calls to cancel a purchase go unanswered, they decide to charge back the amount, and rarely return to purchase from the merchant again.
• When selling and fulfilling your product, ensure that your refund policy is clear. We recommend that your policy include the time allowable to return your product, and the procedure to follow. Your customer service agents should be well aware of your refund policies. Although there are some techniques to avoid losing a sale, the customer must be given the right to return the product without dispute.
• When shipping merchandise, make sure you are sending the item to the mailing address associated to the consumer's credit card. If sending goods to a shipping address that is different from the mailing address associated to the consumer's credit card, we suggest that you call the consumer and have them fax a copy of at least one bill from the address, or a copy of the driver's license of someone who lives at the address that was provided. We never recommend shipping to PO
  boxes.
• For credit card purchases, and to further protect against processing a transaction paid for by a stolen credit card, take the consumer's credit card CVV value on all orders. The CVV value is the 3- or 4-digit number found on the back of a credit card, and is an additional security method used for card-not-present transactions.