|
|
|
|
Online Fraudby Peter Thiruselvam / iEntry Editor-in-Chief ClearCommerce Corporation, a provider of payment processing and fraud protection software for e-commerce, studied 1,100 of its best online merchants to get a better understanding of online fraud. In doing so, they analyzed 6 million transactions from 40,000 customers who were collectively doing business with the company’s merchants. ClearCommerce’s white paper on fraud prevention states that "fraud rates for orders with IP addresses from certain countries outside the U.S. are more than 10 times the typical rate from US orders. In addition, 21 percent of fraudulent orders can be identified by inconsistencies between the consumer’s IP address and their reported billing, shipping or card issuer countries." Many experts feel that last year’s figures will be even higher due to the activities of organized crime taking a larger role in online fraud. Some officials from top US intelligence agencies also believe that terrorists are stealing credit cards to help fund their organizations. To sum up the seriousness of the online fraud, Gartner Inc., one of the major online information researchers, reported that loss because online fraud/identity theft accounts for USD$700 million dollars. This is 19 times that of offline fraud for the same period of time. This loss accounts for 1.14 percent of the total online sales for 2002 (USD$61.8 billion). Additionally, it is not only the actual fraud but the perception of fraud which takes a toll on the bottom line of an ecommerce business. One of the high-powered analysts for Gartner said, "Merchants were rejecting around 5 percent of Internet transactions, on average, as ‘suspicious,’ and at large retailers that sell more than 25 percent of their goods and services online, the figure was up 7%." The number of frauds vary by country. Below is a breakdown of the countries from where the most fraud originates as well as the least. According to ClearCommerce, approximately 6% of all online transactions from such countries as Malaysia and Israel (who are actually on the bottom of the dirty dozen show below) are fraudulent.
I would add Nigeria to the international dirty dozen, with the "help me get my money out of here" email scam. It is also known to be one of the major players in the shipping the goods to a freight forwarder to circumvent the international shipping scrutiny. By the way, most of the victims of this scam pay through account debits and wire services. Top Internet Frauds
Source: Internet Fraud Watch |
|
|
|
