Suspecting Fraud...not sure what to do...

[Dainis]

Hi,

I'm having a surge of new members, but some have invalid email addresses. They are all coming from one affiliate, who did not list his phone number in his sign up. The names of the new members seem fishy and they are all from free email services.

What happens, if this person is perpetrating CC fraud? What happens if I pay him/her a lot of money?

Any advice?

Best,
Dainis

[Linda Buquet]

Hi Dainis,

Well affiliate fraud definitely exists and that does sound fishy, but I'm not certain the best way to uncover and deal with CC fraud. Doesn't your payment processor do some sort of verification on CCs?

Maybe one of our other merchants can chime in with some ideas, since I've never on this particular issue.

[Linda Buquet]

Oh and also if you are getting a sudden suspicious increase in leads it's totally appropriate to contact him and ask how he's promoting you - and raise your concerns.

[Chet]

First, your credit card processor should be telling you if the shipping address the customer uses matches the one on their statement. The big one is the 3 digit security code that is on the back of the cards. Your processor should tell you if that matches or not as well.

Sometimes people move and don't update their billing address right away but there is no excuse for not having the 3 digit code match. If that doesn't match I cancel the order and reverse any commission immediately, no question.

I would indeed contact the affiliate about it, in a nice manner, and see his reaction... also, keep in mind that if it is fraud it might not be the affiliate doing it. It might actually be a person with stolen credit cards using the affiliates site that he just happened to come across.

Is the affiliate new? One of the biggest signs of affiliate fraud is getting leads/sales almost immediately after they sign up for your affiliate program...

[HERSHEL]

Dainis,

In our program we do not hesitate to revoke affiliate status to questionable members. In reality, we would never consider approving any affiliate application unless all required fields are completed and telephone number is a required field. You have to be wary that you are not being set up for some scheme. "Better safe than sorry".

[gallito89]

You should definitely confront him/her on it, fraud is a huge industry online as unfortunate as it may be. Find details on promotion methods, etc. and if you need to, remove them, there are more affiliates out there willing to do legitimate work for you.

[Rob_TID]

Are they all coming from one IP?

Are they all coming from Proxy IPs?

If the answer to one of those questions is yes, then you probably have enough to remove the affiliate.

Affiliate fraud detection is best done with a points system.

free email address
no phone number
high risk country of origin
leads use free email address
leads from one IP
leads from public proxies
phony sounding lead names
etc etc