Payment Chargebacks Shopify (How to avoid getting scammed?)

[OneLinkSolutions]

Hi Guys, someone is trying to make orders on my company which shopify is flagging as high-risk, although they are different names & address it is evident that it is the same person as the location for all is the same place in London, however upon checking the cards they are using to pay are NZ & AU. I seek your advise on what I can do, on the first order I asked for this:

To continue and valitate your order:
Please provide a government-issued ID and a picture of the last 4 digits of the card number used to place the order (to match with the card used to pay, please cover other details) / alternatively a bank statement which shows the purchase with us.

However they are refusing to do so based on 'privacy concerns', and only offered to show ID. As the card is likely not in their name, if I made them sign an order receipt do you think it would cover me in case of a chargeback?

Additionally, if I were to capture the payment and not ship the item, as they are 100% fraudsters, what would then be the procedure?

I have previously accepted high-risk orders and fortunately not had chargebacks, but I'm trying to learn the system as I get them frequently within my industry.

If the order is accepted and fulfilled as normal, what is the likelihood of a chargeback? and can I counter it with some form of proof?

What would you do in this situation, as it's risk vs reward since the value is quite high.

Thanks!

 

[polonieth]

OneLinkSolutions said:
Hi Guys, someone is trying to make orders on my company which shopify is flagging as high-risk, although they are different names & address it is evident that it is the same person as the location for all is the same place in London, however upon checking the cards they are using to pay are NZ & AU. I seek your advise on what I can do, on the first order I asked for this:

To continue and valitate your order:
Please provide a government-issued ID and a picture of the last 4 digits of the card number used to place the order (to match with the card used to pay, please cover other details) / alternatively a bank statement which shows the purchase with us.

However they are refusing to do so based on 'privacy concerns', and only offered to show ID. As the card is likely not in their name, if I made them sign an order receipt do you think it would cover me in case of a chargeback?

Additionally, if I were to capture the payment and not ship the item, as they are 100% fraudsters, what would then be the procedure?

I have previously accepted high-risk orders and fortunately not had chargebacks, but I'm trying to learn the system as I get them frequently within my industry.

If the order is accepted and fulfilled as normal, what is the likelihood of a chargeback? and can I counter it with some form of proof?

What would you do in this situation, as it's risk vs reward since the value is quite high.

Thanks!
Click to expand...

How much will you be out of pocket if there is a chargeback?

And what sort of chargeback are you envisaging?

If it's an order placed on a stolen card, then no amount of proof on your end will help you win a chargeback.

For friendly fraud, if the buyer initiated the chargeback, for example, claiming failure to deliver the goods, then you might have a chance if you have solid proof that it was delivered.

If the buyer initiates a chargeback for goods unsuitable for their purpose, I rarely see the merchant win the chargeback.

I'd just go on gut instinct? Australian bank card to a London address isn't a red flag by itself, usually these things are multi-hit where you see 2, 3, 4 things that look suspicious...

Btw you must have a good or rare product; I'd never send in ID and bank statements for something I've bought. You'd have lost me instantly

 

[OneLinkSolutions]

polonieth said:
How much will you be out of pocket if there is a chargeback?

And what sort of chargeback are you envisaging?

If it's an order placed on a stolen card, then no amount of proof on your end will help you win a chargeback.

For friendly fraud, if the buyer initiated the chargeback, for example, claiming failure to deliver the goods, then you might have a chance if you have solid proof that it was delivered.

If the buyer initiates a chargeback for goods unsuitable for their purpose, I rarely see the merchant win the chargeback.

I'd just go on gut instinct? Australian bank card to a London address isn't a red flag by itself, usually these things are multi-hit where you see 2, 3, 4 things that look suspicious...

Btw you must have a good or rare product; I'd never send in ID and bank statements for something I've bought. You'd have lost me instantly
Click to expand...

Thanks for your response,
To clarify it is for designer clothing, the individual has done orders worth around £5k but under 4 different names and addreses, all with AU cards, and the IP address it the same for each order. I fulfilled the first as a benefit of the doubt, then the others came through.

I have previously accepted some potentially dodgy orders but no chargeback had happened, when does this usually come through?

My question is, in this procedure, as I want the possibility to gain those funds, what would be the best thing?

A. Ask for some form of ID / Confirmation (other details?)

B. Accept the orders and delay fulfillment

What can I do to possibly have the order go through and have a backup in case of a charegeback.

Thanks!

 

[polonieth]

The same person used 4 different names and addresses? I don't think I'd be fulfilling that one.

If the transaction is fraudulent, you'll lose the chargeback. The card issuer will eventually be alerted that fraud is happening, and the fraudulent transactions will all be charged back. There is nothing you can do. When it happens depends on when it's picked up. It will probably be okay if it has been months since you accepted a potentially dodgy order.

Delaying fulfilment is your only real option.

Or cancel it and ask for payment via bank transfer for the order. You hold all the power then, but as a customer, I'd never transfer £5k for an online order. Or if I did it'd be after a fair bit of due diligence and a healthy discount.

Do Shopify charge your for chargebacks? Stripe started charging £20 per dispute, which was annoying.