Anyone run into this scam/fraud? Beware Shopify doesn't seem to care about it.

[NotImpressed]

I just finished a long discussion with Shopify, they don't care. Here is the scam. See if you can figure it out.

This is the second occurrence of the same scenario.  I receive a high fraud risk order. The IP address is thousands of miles away, the buyer is not the receiver and the buyers phone number is a duplicate of the receiver's phone number.  The email for contact is fraudulent.  

I contacted the receiver (ship to individual). He says yes I ordered that product. When asked why the buyer was a different person, he doesn't know the buyer.  The last four of the visa card number are not one of his. So he was asked where he purchased the item, answer is ebay.  I don't sell on ebay.  When asked what he paid, $29. My product sells for $55, plus the shipping. 

So someone on ebay has sold this customer a product for $29, then turns around and buys it from me for $66 (product plus shipping) to be delivered to the guy who ordered it from him on ebay.  Sound like a scam to you?

This is the second time the same thing has come up and its the same product that was purchased in both instances.

See if this possibility works for you.  I sell a product on ebay for $29, I get the $29.  I use a stolen credit card to purchase it from a legitimate store for shipment to the original buyer.  The store calls the customer and he confirms he ordered the product (but isn't asked where he ordered it from).  Merchant ships, customer gets the item. The customer is happy, the ebay scammer gets $29 for doing nothing, ebay takes their sales cut, shopify and the card processer take their fees.  The merchant thinks he has a completed sale.

A month or so passes and the merchant gets hit with a fraudulent charge and charge back fee for a fraudulent purchase when the stolen credit card owner realizes he's been a victim and the bank tries to get their money back.  The merchant is screwed out of the product, the sale, and the chargeback fee.  Everybody is happy except the real victim, the merchant.  I now know that Shopify, Stripe, the bank and Ebay do not care, because they are getting paid.   So, run the high risk stuff to ground because they don't care.

I use a site called People Looker (its not expensive) to run down names, addresses, emails, phone numbers and then call to confirm (its not expensive).  If I don't get a confirmation, the addresses or email are bogus, I refund the sale and never ship.  If its a legitimate sell and they want it, they will call.

Also, my staff knows if things don't match, don't ship until I approve.

[JoesIdeas]

Ya these are annoying, it's not Shopify's fault though, the credit card companies are wayyyyy too 1-sided with the customer, if that customer is a scammer that steals from you.

Unfortunately because laws aren't good enough to punish these scammers, it's a part of doing business for every online store owner.

With that in mind, the burden is up to you and your team. In my tests, I found that around 20 - 30% of orders marked high risk by Shopify were fraudulent, and a tiny percent of medium risk orders were fraudulent. I ran this test with Shopify store owners (I run an app called Order Automator that automatically notifies staff and optionally cancels risky orders).

With that data in mind, if you want to be super conservative you can cancel high risk orders (and of course email the customer that it tripped your security system).

My preferred system:

1) When a high risk order comes in, have a notification sent to support to investigate

2) Support contacts any fulfillment attached to prevent the fulfillment until they verify it

3) Support emails the customer asking about the order, requesting a picture of their driver's license to match with the name, and has the customer agree in writing that they want to purchase this item, waives their right to a return, and confirms this is a legit order and they will not file for a chargeback.

With step 3, it can be abrasive to legit customers, so just explain that there are dishonest people out there that steal from you, hurting the business, and this is just a procedure to prevent that. And if they still do file a charge back, you have that evidence to provide to the bank that they agreed in writing to.

Sorry you have to deal with this, it's frustrating, I hope any of the tips I shared that have worked for my business and clients can help you.

[Pops02]

Hi JoesIdeas. I'm experiencing an issue with Bing I cannot see myshopify online store.  Please assist on how to resolve this issue.

Thank you.

[NotImpressed]

Your reply translated. 

Its not Shopify's fault, its just part of doing business. Shopify doesn't do anything to deter the fraud and we are not going to start.  Because we still make money off the transaction and that's what counts.  We also will not support the small business when it gets defrauded.  Why? Because we still profit from those transactions.  So good luck and keep making money for us because we don't really care.

So thank you for doing nothing.

[Twizted1up]

I  just got this message when my friend checked my store out 

[beaux]

I am late giving advice here but also look at the IP address. Yes it is spoofed, but pay attention to the first 3 numbers. Are they always the same as other fraud orders? In my case they almost always are because it is just 1 person doing it using the same VPN. 

[JoesIdeas]

Good tip Beaux.

I have since updated my system and just cancel orders that are high risk, send a nice email to the customer explaining why (we've been victims of fraud in the past), send them links to the products in their order and ask them to checkout again with a different form of payment.

This has cut down chargebacks almost completely.

[NewtonPens]

"I receive a high fraud risk order."

Cancel and refund, then block IP and addresses and everything else about this purchase.  Why deal with a high fraud order?  Makes no sense.

[YaMaYa]

I believe Shopify has become a scam. What was once an affordable and user-friendly platform for running a store has transformed into a costly and frustrating experience. Over time, Shopify has increased its reliance on automation and AI, reducing the need for human employees (you won’t get a live person who can fix your account anymore) while steadily raising its rates. This might be great for the platform’s owners, who can rake in millions overnight, but it’s a nightmare for users who are left struggling to navigate their convoluted policies just to get answers.

Shopify’s pricing, which now starts at $39 per month, continues to climb, making it less accessible for small business owners. If you’re like me and invested significant time and money into building your store from scratch, thinking this platform was user-friendly and cost-effective, you might feel deceived—this is where the scam lies. We, the ones who built our businesses on Shopify, have been booted out, while those who manage to make money are pressured into buying expensive upgrades just to keep their stores running.

I strongly suggest you leave Shopify immediately. What was once a helpful platform has now turned into a money pit that no longer serves its users. Stay away from Shopify. Last thing, repost this as many times until this interface is shutdown. They may morph into something else. Stay away from automation that charges monthly instead of allowing you to own in. The only one winning is the person on top and they have the power to shut you down whenever. Also they have no protection against chargebacks. Good luck out there!