How to handle fraudulent orders causing financial loss?

[ascentoutfitter]

Hi, recently I have been getting fraudulent orders for excessive amounts of up to $5,000 USD on my website. I cancel the orders but Shopify still makes me pay a fee and I am losing up to $400 when someone places this and I have to refund or cancel the orders. Someone please help, this is running my small store out of business. Thanks. Example order is posted below. I only receive $4,500 and have to payback $5,000 to Shopify. This has happened repeatedly.

  

[PaulMartin]

Hey Ascentoutfitter, I don't know how to solve that problem.

However, someone in the community has shared how to avoid the problem in the future, you might want to look into this and set it up:
A Guide to Prevent Fraudulent Chargebacks with Shopify Payments [2FA] : r/shopify (reddit.com)

[Myung]

Imagine receiving an order, only to be notified that the order is fraudulent. Upon canceling the order, I still get charged transaction fees. Just think, anyone can do this to you, and they might even have connections with Shopify, as they profit from canceled orders. Just wow.

[ascentoutfitter]

Try this, I had the same issue.

“ The most important thing you can do right now is head to Payment settings and manage the capture method. Change this to either capture at fulfillment or manual. This gives you the chance to review each order that comes through before it's processed. If you cancel an order, only an authorization is cancelled if you didn't capture. This results in no transaction fees lost and no reversed transaction on your account”