Should I decline a high risk fraudulent order?

NineAmulets
Excursionist
54 0 12

Hi,

I just received an order saying: "high risk of fraud detected" And the final review says

 

  1. Negative
    Characteristics of this order are similar to fraudulent orders observed in the past
  2. Negative
    Billing address ZIP or postal code doesn't match credit card's registered address
  3. Negative
    Shipping address is 2190 km from location of IP address
  4. Negative
    The billing address is listed as Mexico, but the order was placed from United States
  5. Neutral
    Card Verification Value (CVV) isn't available
  6. Neutral
    Location of IP address used to place the order is Los Angeles, California, United States
  7. Positive
    Billing street address matches credit card's registered address
  8. Positive
    There was 1 payment attempt
  9. Positive
    Payment was made with 1 credit card
  10. Positive
    The IP address used to place the order isn't a high risk internet connection (web proxy)

Should I decline this order? The e-mail is kind of suspicious with only numbers before @. I also checked the shipping address and it's a trucking company.

Replies 6 (6)

Moira
Shopify Staff
2053 224 326

Hey @NineAmulets,

 

Have you received an order from this person before? Our fraud analysis system does a thorough analysis to determine each order's risk level. Ultimately, the decision is up to you if you feel comfortable fulfilling the order. It's important to note that fulfilling high-risk orders can result in a higher number of chargebacks and that can result in disabling payment processing and removal from Shopify Payments.

 

I highly recommend reaching out to the customer to verify some of the order details and provide an ID matching the card used to purchase before you move forward with this order. Verifying the order is a way to confirm the identity of the customer (or the credit card) and to protect yourself from a chargeback. Typically, if you're unable to verify an order with high risk, then we'd encourage leaning to the side of safety and refunding the order.

 

I wanted to recommend an app; if you are looking for another layer of protection outside of our fraud analysis, take a look at Fraud Filter, you can use this app to create your own rules that would either flag or cancel your orders that came through as high risk.

 

Please let me know if you have any further questions!

Moira | Social Care @ Shopify
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gymratsinc
Visitor
2 0 1

Is there a way to DECLINE the order if the order is deemed fraudulent?  I lost $9.00 in cc fees since Shopify no longer refunds the cc fees.  I know you can set the system to DECLINE if the AVS and/or the CVS fails, but the highly obvious fraudulent orders should be declined as well.

Moira
Shopify Staff
2053 224 326

As a Shopify store owner, the only other way you can decline a customer's order is if it is deemed fraudulent. Here are the steps to do so:

  1. Log in to your Shopify account and go to the Orders section.

  2. Find the order that you want to decline and click on it to view the order details.

  3. In the order details page, click on the More actions button and select Cancel order.

  4. In the cancellation reason menu, select "Fraudulent order" as the reason for canceling the order.

  5. Click on the Cancel order button to confirm the cancellation.

Once you cancel the order, the customer will receive a notification stating that the order has been canceled, and their payment will be refunded.

Moira | Social Care @ Shopify
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- Was your question answered? Mark it as an Accepted Solution
- To learn more visit the Shopify Help Center or the Shopify Blog

Shopbeenthat
Tourist
11 0 2

Hi, so how do we get the fees back that Shopify charged for the order since we have to cancel the order for being fraudulent? There should be a way and if not it is highly inconsiderate of Shopify to charge their users for things we can not control . 

dylanpierce
Shopify Partner
215 3 97

@Gymratsinc @Shopbeenthat 

Do you have automatic payment capture enabled by chance? That might be the issue.

Even though you might decline and refund a risky order, the cardholder can still initiate a chargeback because the funds were charged to the credit card at the time of the order.

What you can do to avoid these is set up manual payment capture. When the customer places and order, it still "holds" the charge on their card. But this gives you a window (30-60 days depending on the bank issuer of the card) to make sure it's not a risky order.

Once you've verified the order isn't risky, either through contacting the customer, asking for additional details like email, phone or ID verification, then you can manually charge their card.

We wrote a short blog post on the difference between manual vs automatic charging, and the details of how switching to manual charging avoids these chargeback fees:

https://getverdict.com/blog/avoid-shopify-chargeback-and-refund-fees

Founder of Real ID - Verify your customer's real IDs easily & securely with modern A.I.

Want to see it in action? Check out our demo store.

Shopbeenthat
Tourist
11 0 2

Hey Ok so what you’re telling me is I would have to manually accept EVERY order that’s placed on my website and not just orders that are flagged as fraudulent by Shopify ? If so that is very time consuming