They explained it to us; that we either needed to provide a signed receipt or a credit card authorisation form, so we had to provide either of those. Obviously in online we didn’t have the opportunity to do that and it provided some massive hurdles for us.
There’s no one that provides insurance against this, either. All we can do as a merchant is make sure that our systems are well and truly catching up or identifying potentially dodgy transactions before we send out the products.
The bank basically just takes it straight out of your account. Now, it’s not a huge amount of money, but we’d only started with $20,000. So you imagine someone taking 20% of your capital, and it hurts.
We started building systems that allow us to capture and catch these types of things before we send out these items. And just four or five months ago, we were able to take part in the apprehension of the fraudster.
This time he was stupid enough to put his address as the delivery address. One thing led to another and they found him.
We’ve got a mixture of staff training, and a couple of software packages that talk to each other, and that provides things like fraud ratings and different sorts of flags that go up in our system. If so, we put those transactions on hold.
One of the major things we did was some research. Happily, the banks were good in understanding our predicament and they were able to help work with us and then put in place some processes which turned out to help us a lot. They enable us to catch things as they happen.
Part of the whole strategy with online is to remove any barrier to purchase for the customer. Things like verification through Visa are a bigger hurdle, so we’ve decided not to go down that route and build our own systems in house.
Just be ready to know the systems as best you can. Know how things work before you start doing it, and then just be aware of what you need to do.
Make your site as safe as possible.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
