Fraudulent Card Use and Chargeback

[RegMolehusband]

For the first time in seven years of trading I've had a chargeback for £563.14.

This was a normal looking online transaction processed via Sagepay and Cardnet and the goods were delivered to the "customer" a few days later.

I provided Cardnet with evidence of the transaction and a signed POD to a delivery address in Dagenham. I've looked at the property on Streetview and it's an innocuous looking semi detached.

Cardnet have now written saying they have reviewed the information I provided which unfortunately does not provide a remedy, it is evident that this relates to a fraudulent transaction not undertaken by the genuine card holder. So they confirmed that in accordance with their Full Recourse Agreement the debit to our bank account will stand.

So why does my company (and consequentially I) have to cover the full cost when Sagepay allowed the transaction to go through?

Is it worth involving the police?

Any ideas from anybody having experience of chargebacks would be appreciated.

[RegMolehusband]

Trax8 said:

What's even more annoying is the fact that its us the seller that is always out of pocket, the card holder gets their money back, the fraudster has the goods and the bank and card issuer get away with it, they make the card holder think that they have made them a big favour refunding their money.

They even charge us an admin fee of £25 on top of what you have lost!

Yes, that's how it seems to me!

[RegMolehusband]

grumbas said:

Surely Sagepay tells you if the address the customer supplied at checkout matched the card billing address?

If it did and it matched I'd be going back to your bank and having an argument (the card holder will have signed a declaration they had nothing to do with the charge which is clearly rubbish if you delivered the goods to the cards billing address).

If it doesn't I'd be getting this check added asap! If you already have the check result visible but it didn't match then you may as well chalk this one up as experience.

The addresses don't have to match for the transaction to go through. Many of my transactions have a different billing address from the delivery address. It's quite normal.

cuneus said:

What is going to prevent you from taking the payment processor to court ?

I don't want to get involved in that.

When it comes down to it I suppose I've only lost the cost of the product which is about £350.

[RegMolehusband]

DSLiverpool said:

OP sorry to hear it, it happens but it can be reduced.

Anything over £200 needs a phone call, if no reply leave a message stating you have an address query - you see a pattern and get a sixth sense for it.

Your scenario today could be a simple mistake and must involve you calling the buyer to tell them you think a mistake has been made and they either agree and pay you or they put the phone down.

Thank you DS, the thing is my average online order is £510 so that would be a lot of calls considering it's the first chargeback in seven years. Cardholder not present telephone orders can be in the £5K-£6K region!

However I've been lucky so far.

The cardholder lives in the USA so I don't think it's a mistake. However I do have a mobile number for the "buyer" so will ring it tomorrow to see what sort of response I get.

Edited by RegMolehusband on Sunday 22 March 12:02

[RegMolehusband]

I've just looked back at the online order notification. The billing address is the same as the delivery address in Dagenham. Yet the Capital One card is apparently registered to somebody call Ginger L. Proffitt according to the American fraud information form forwarded from Capital One by Cardnet.

I didn't have 3D secure enabled before this but I do now.

[RegMolehusband]

The mobile number entered during the online purchase isn't recognised - well there's a surprise . . .

Still, onwards and upwards

[RegMolehusband]

sugerbear said:

Did the acquirer (and you) do an AVS (address verification) check?

Edited by sugerbear on Monday 23 March 16:22

I've never looked at the SagePay transaction report to review an order. Looking down it now most orders get a good "fraud screening action" score. However this one does get a particularly bad rating. It's a shame that SagePay doesn't send this information through with the order notification.

For some reason SagePay says NOT CHECKED against some of the addresses, including this rogue order, so I'm not sure what that is all about.

I've been trying to bring down the order administration time but it looks like it's worth 30 seconds to log on to SagePay for the larger orders.

I've blocked the use of the card number so "Ms. Olivia Tumecorn" (yes I know, so many things that should ring alarm bells) won't be able to use that card again on my site.

All in a day's work from now.

[RegMolehusband]

That is very helpful Doc, I will put in place a similar procedure

Edited by RegMolehusband on Monday 23 March 17:40

[RegMolehusband]

jammy_basturd said:

Just out of interest, which ecommerce platforms and SagePay plugins are you guys using that aren't reporting the 3D Secure, AVS and CV2 stuff back into the platform?

I use Magento which does report on AVS etc. However I rarely view the SOP side of Magento as the online order data is imported straight into our accounting software Kashflow using "carrytheone". However this doesn't include the card processing information, neither does the order notification that comes through from Magento. I might have a look to see if it can be configured to do so.