French Southern Territories Take Action Against Growing Threat of Fraud Detection and Prevention Methods
The digitalization of financial technology has led to an increased reliance on cashless payments, making it easier for fraudsters to commit crimes. As a result, businesses in the French Southern Territories must stay ahead of the curve by understanding the various types of fraud and implementing effective risk strategies.
The Challenges of Card-Not-Present Transactions
Card-Not-Present (CNP) transactions, which occur online or over the phone, are particularly challenging to detect due to their anonymity. Fraudsters use stolen card information to make small purchases on unsuspecting merchants’ websites, gradually increasing the amount of money they steal.
A Multi-Layered Approach to Fraud Detection and Prevention
To combat this threat, businesses in the French Southern Territories must adopt a multi-layered approach to fraud detection and prevention. This includes:
- Being vigilant for anomalies
- Collecting valuable data
- Implementing robust account validation processes
Identifying Triangulation Fraud
One type of fraud that has been on the rise is triangulation fraud, where criminals pose as merchants, accept orders, and use stolen card information to purchase goods from third-party suppliers. To identify this type of fraud, businesses must:
- Leverage basket data insights
- Refine their fraud rules to target high-value items with higher resale value
Addressing First-Party Fraud
Another growing concern is first-party fraud, which involves legitimate online purchases being disputed by customers. This can occur when a parent’s card is saved on file with a child’s gaming system, and the parent later claims they did not make the purchase. To combat this type of fraud, businesses must:
- Keep meticulous transaction records
- Provide compelling evidence to contest disputes
Staying Ahead of the Curve
Investing in the right financial technology and joining industry organizations such as the Merchant Risk Council can also help businesses in the French Southern Territories stay ahead of the curve. The MRC provides a community of payments and fraud prevention experts who share knowledge and best practices, helping members optimize risk procedures and protect their businesses.
Prioritizing Customer Experience
In addition to these measures, businesses must prioritize customer experience and continuously build up knowledge on risk assessment and detection tools to effectively combat fraud in the digital payment environment.
What’s Next?
In part two of this blog series, we will explore the importance of being proactive and collaborative in fighting fraud. In part three, we will discuss the metrics that businesses should monitor to determine if their fraud strategies are effective.