Last August, I proudly launched my first self-designed website and then quickly began the daunting task of getting the world to beat a path to it. To my happy surprise a few orders actually came in the first week. Among them was a nice large order from Indonesia of all places. Talk about excited! I soon learned however, that the buyer’s credit card was evidently maxed out because the charge wouldn’t go through. When I notified him about this problem he promised to get back with another but I never heard from him again. I was deflated but still excited that my web site was being viewed around the world. I had no qualms at all about selling my product overseas just as I had done in my previous on-line business; as far as I was concerned everyone was welcome!
Well, about a week later another international order came through, also from Indonesia but apparently unrelated to the first. This time the charge did go through and I packed off the goods to the awaiting buyer. Several months later, and after many more attempts by Indonesian buyers to purchase my product, I finally began to feel that indeed, all this was too good to be true. My premonition was verified when the reports of fraudulent credit card use started arriving from my merchant account bank. Since each of these foreign purchases turned out to be fraudulent, I took it on the nose for every one!
More and more of the charges for these orders were turning out to be impossible to charge through anyway which turned out to be my good fortune. I began scrutinizing each one as a matter of routine, doing my “due diligence” as it were. So far, not one of several dozen has ever been legitimate. What is going on?
What I discovered the hard way is that fraudulent international credit card purchases from unwary on-line merchants is a scam of huge proportions. According to the credit card companies, billions of dollars are being ripped off this way every year and the perpetrators run hardly any risk of getting nailed whatsoever. If you doubt it, you’d better get wise quickly: CNN recently reported that Expedia.com, the big on-line travel agent, has already suffered over $4 million dollars in credit card fraud!
Where are these orders coming from? Romania leads the pack as #1, with my fans in Indonesia a close second. Vying hard for third are Russia, Nigeria, Hungary, Mexico, Egypt, the Philippines, Austria, Hungary, Belarus, Estonia, Latvia, Lithuania, Slovak Republic, Ukraine, Yugoslavia, and Macedonia. These are only the most active; you can be sure that this threat can come from any corner of the globe.
To make it even more egregious, there exists on the web a kind of helpful infrastructure to promote this fraud and make it even more easily accomplished. I have heard of free software available that generates a supply of credit card numbers associated with a particular bank. And, to add insult to injury, there is also a list floating around out there of “sucker” merchants who have been duped already and are worthy of another shot. I don’t know if I’m on it now but I do know I won’t be the next time it’s updated!
How to Stay off the “Sucker List”
First, the order itself may offer you some warning. Watch out for big orders with little regard for shipping costs. These “customers” will often request the most expensive shipping options – usually a dead giveaway.
They may also want you to ship the order to a different address. There are of course, legitimate reasons to do this but it is usually a way to avoid the address verification anti-fraud protections that credit card companies use.
Even though they may ask you to ship to a U.S. address, don’t let your guard down. Many of these scammists are aware that their countries are well known for this type of illegitimate activity and so they arrange for a U.S. partner to forward the merchandise to them.
I believe that for all international orders your best bet is to establish a rigorous screening procedure that you follow at all times.
Always ask the buyer for the name on the card, and the address associated with the card. If it is in the U.S., the chances are good that it is a bogus order. Of course they might give you false information, but this can easily be checked out. (This once happened to me and it was then that I realized that all these “great” orders were actually more of a curse).
Since you have no signature to fall back on you must do everything you can to be sure that the charge is a valid one because you will most certainly be held responsible for it if and when it proves to be false. If you are lucky the account holder may already have been warned of the illegal use of their credit card number and it will be rejected when you try to process it. If, after ascertaining there are funds in the account, don’t stop there. Contact your merchant bank and obtain the issuing bank’s telephone number. Then call that bank and verify the address. This can usually be done using their automated system. You can (and should) try to talk to someone in their Customer Protection and Security Department to further verify the charge and make sure that both the bank and customer are warned of what is going on. Often the bank will ask you to wait a day while they contact the true card owner.
If your would-be customer persists, even after having been informed that they are no-good, lousy, thieving scumbags, then you insist that they pay up front with an American Express check or money order or with a cashier’s check drawn on an American bank. And then don’t ship until the payment clears. Although they are becoming more brazen in their attempts to rip you off, you still have the last word. If there is any doubt at all, pass on the order.
Believe me, it’s not worth the risk. You just don’t want the headache of seeing a pile of fraud notices in your mail box and the real possibility of losing your merchant account. Remember that notwithstanding all the fears associated with buying on the internet, the customer usually has a way to get his or her money back. If you take a fraudulent card, you probably won’t. Seller beware!
David Ryan is owner and founder of GoingPostal!, a t_shirt company using classic and historic postal art for its designs. He has also been a travel photographer and writer for 32 years, and now lives in Boise, Idaho. He can be contacted at david@goingpostal.cc and you can see why the world is beating down his doors at http://www.goingpostal.cc
