I need help

[DonHouston]

Ok here is the deal. The company I work for has been getting a lot of fraudulant orders placed. Now the problem is that when an order is placed through paypal we set up the account immediatly in order to give outstanding customer service. Here is our issue, 2-4 days later we are notified that the order was fraud. Now we have the server up for the client and the order is fraud so we have to refund the order but we do not get money back from the center in which we have servers through. In this senario what can we "little fish" do to protect our selves and our assets?


Thanks for you help

[clementsweb]

You should use some activation methods, ie:

Details completed --> Paypal --> Email sent to customer to activate --> Activation completed and server setup.

If this helps at all.

Thanks
Matt

[DonHouston]

You should use some activation methods, ie:

Details completed --> Paypal --> Email sent to customer to activate --> Activation completed and server setup.



Matt,
I am not quite sure what you mean. We send an e-mail out to the client once we get notification that payment was recieved. However some people have two e-mails, one that is for nothing but paypal, and the other that they use to communicate with hosts and other people. So I am not sure how that helps with the fraud issue. Maybe I am misunderstanding what your saying?

[omnibus]

I think really the only solution to this would be to do a verification...Make a phone call. I actually wouldnt think of this as a negative thing If I were hosting with you, It gives you a chance to connect with the customer and makes you less of a faceless company. I appreciate that in a company.

[DonHouston]

omnibus,
Thanks for the reply. Yes this is something we have talked about, but we are not sure if we are going to do that. But this is something that has come up in several meetings several times.

[pageBuzz]

Welcome to the internet. If you are going to do business, you will always get the bad people with the good.

I have solved the problem by limiting my customer base and targeting niche markets. I run an online site builder and target particular low risk markets via marketing websites.

Since we deal pretty much with people that have no idea how to build a website, we don't get any fraud from hackers or people looking to exploit servers. We don't allow customers ftp access or the ability to install their own programs.

As soon as you offer open space, your client base becomes a highly technicaly advanced group. That group will be particularly dangerous on the servers as well as much more likely to be fraudulent.

The bigger you are, the worse it gets.

I know programing a complete solution with online site builder is not an option for most people, but if it is, then it is a much more friendly market. And our average customer remains indefinetly where most open hosting has high turnover rates on new clients.

As far as getting clients, if you advertise on warez sites or on youtube, the customers you get will be lousy. If you advertise on small business sites, the opportunity for better customers is much brighter.

Rather than addressing the signup at paypal, address the direction that your client base is derrived and the fraud will decrease.

If you have a bad sale and the fraudster gets access to the site for 3 or 4 days, they have already done the damage or used what they needed. If it is a big problem, a verification call is not a bad idea.

[EastsideHosting]

Being an owner of a webhosting company I dont see alot of fraud with paypal but I see my share with creaditcard but I allways verify by calling even tho I have fraud protection with my creadit card terminal...

[brianoz]

... when an order is placed through paypal we set up the account immediatly in order to give outstanding customer service. ... but we do not get money back from the center in which we have servers through. In this senario what can we "little fish" do to protect our selves and our assets?I'd have to say this immediate setup is just not taking care of your own interests. Immediate setup isn't good customer service if you go broke as a result, or if you let spammers loose on your datacenter's network for a few days (they only need a few HOURS to send thousands of spam messages!). All the real players in this area pretty much require faxed credit card front and back and some form of ID. You should also confirm phone numbers and do basic fraud checking along the lines of maxmind or similar. If you do these things, plus use a little intuition, you'll rarely have a problem.

[ryan1918]

I know how a lot of people fraud paypal, they log there computer, get there paypal information and boom, they have it all, the best thing to protect against paypal fraud is to make sure they are verified, then I would suggest emailing and confirming with the verified email address and make sure they email you back from that address and even have them call you just as another thing that a fraudsters wouldn't want to do!