I posted this in a response on another thread on the subject of high risk of fraud orders. A Shopify moderator suggested I post it as a new thread. So here goes, along with updates.
I've been using Shopify for four years and just had my first and second fraudulent orders, both from Montreal.
First order was identified as high risk, but no specific problems were identified. I contacted the customer, who sent me a photo of herself and her driver's license. She confirmed that it was a genuine order. I sent the item. The customer took about a week to pay the duties and accept delivery. The day before the item was delivered, she filed a chargeback. I disputed it, of course, with all the documentation, and that's now in process. Though I now don't have the item or my money. Update: No communication from the customer since the item was delivered, and Shopify indicates that bank will receive my response 18 May. As far as I can tell, I'm fully backed up on this with shipping info, emails, etc. Also, the customer provided a photo of herself and a driver's license. If money is not returned to my account, I'll be in touch with Shopify on further remedies. Note for Shopify: Why would Shopify take so long to submit my chargeback response to the bank?
Second order came in 17 days later. Another high value order with a fraud alert from Shopify, this time with credit card discrepancies, though the order did go through. I called Shopify Support right way, and they were helpful. I cancelled the order, no notification to the "customer." I was informed that the way it works is that Shopify refunds the money right away and then makes internal adjustments so that the money doesn't actually reach my account. Update: Both orders were from Montreal, addresses 15 miles apart. I just checked the ISP addresses, and they are identical. When I cancelled the order, I did not notify the "customer." No money hit my account, no product left, no reason to communicate. This person, however, actually contacted me a couple of days later asking about a ship date. I responded that the items were out of stock and the order cancelled. Given that both orders came from the same ISP, this was clearly a coordinated fraud. Note for Merchants: It is critical to contact Shopify immediately upon receipt of a fraudulent order and before funds are deposited to your account. They can stop the transaction right away, no harm/no foul. Once a fraudulent payment hits your account, undoing it can be more of a problem. I'm not entirely sure how, apart from the risk of chargeback, but, as the saying goes, fool me once, shame on me. . . I've learned that lesson and do not care to repeat it.
I would be interested in comments from other Shopify merchants regarding similar experiences, with high-value orders from Canada - Quebec or elsewhere - that have been flagged as possible fraud. At this point it doesn't really matter. The most recent order is cancelled, and the chargeback will either result in my getting my money or learning a hard lesson. And I've entered a slew of fraud rules to try to prevent this from even getting to the order stage. But I'm still curious.
Asking for ID & selfie is a great way to verify a customer's identity. You can use that information to tie together the Billing Address/Shipping Address & Credit Card.
Another question, if you cancel an order but verify the customer's identity - is it possible to resume the order or will the customer need to reorder?
Anecdotally, Montreal is a HUGE hotspot for fraudsters. There's an entire ring operating in that city where they seem to be obtaining stolen information via what I assume is wallet theft. Often they have driver's licenses, the physical credit cards, etc.
My old company dealt with them *heavily* about 2 years ago, and it looks like they're back. A selfie is a fantastic idea!
We have recently been hit with a lot of orders from Canada. We have shipped out 2 and then turned on some more security measures that started to flag more as fraudulent and denying card approvals so we have a lot fo abandoned carts now from these people. One person made 3 accounts with 3 different emails and tried 3 different cards, but all with the same customer name.
They all ship to somewhere in MB but they bill from somewhere else in Canada. All of them have the same last name but use a different first name. I assume the name on the billing is a real person and then they make up what looks to be a relative's name for the shipping.
This just started in early March. They often use a @Mail.com email.
This is a follow-up to my original post. The chargeback was resolved in favor of the customer.
So, the customer has my product and I don't have my money.
I am in touch with my local police, who will be in touch with the police in Canada. Probably nothing will happen, but it will be in the system. I am also in touch with a lawyer who will write a strongly worded letter. Again, probably to no avail, but I'll feel better.
I don't know if there is DM feature on this forum, but if you have a suspicious order in the Montreal area, I'm happy to let yo know if it's the same individual who defrauded me.
Fraud rules are a reasonable response to having been burned. I do not accept any orders from Quebec, for example.
I would further suggest that Shopify take the further step of banning confirmed fraudulent shoppers for all of its website customers.