Cybercriminal activities are continuously advancing and businesses need to keep up with their pace in order to mitigate these threats. In an era of digital transformation, companies are exposing themselves to numerous threats. It is those gaps that these threat actors are seeking to penetrate. The rise in competition and transparency has led many retailers looking to differentiate themselves in the market to offer generous customer service and flexible return policies. In 2018 cybercriminals will continue to leverage faked receipts to commit fraud. Such generators can be found in DDW forums and in some surface-web communities. Based on DDW chatter, Flashpoint analysts assess with a low degree of confidence that these vendors may be using serial number generators-software capable of generating valid serial numbers-in order to supply their clients. These serial numbers are likely used in conjunction with other tactics to obtain a refund or replacement shipment. For example, fraudsters may claim they received an empty box, items were missing from their shipments, they received the wrong item, or the item arrived in a damaged state.įlashpoint analysts discovered that several receipt vendors also offered product serial numbers to their clients as well. Moreover, physical receipts may be used to return stolen items in exchange for money or store credit.ĭigital receipts may be used to make false claims about an online order to elicit a refund or replacement shipment from the retailer. They also make it more difficult for retailers to trace multiple instances of fraud to the same individual. However, fake receipt vendors are often capable of targeting a variety of companies and are able to adjust their tactics, techniques and procedures (TTPs) in response to customer concerns and demands.įake receipts facilitate fraud by eliminating the need for malicious actors to make an initial purchase from the targeted retailer. Fake receipts typically target retailers that sell technology products, and they are often available for less than $10 USD per receipt. These actors are capable of producing counterfeit receipts in a variety of formats, including physical store receipts, packing slips, and digital receipts. After finding a reliable refund vendor, forum members will often become repeat customers, requesting refunds from a variety of companies the vendor targets.Īs analysts of business risk intelligence, we have observed numerous vendors advertising fraudulent receipts for sale on the DDW. Indeed, satisfied customers have been known to leave positive reviews accompanied by screenshots of emails sent by impacted stores issuing refunds. Successful refund vendors have gained loyal followings within their cybercriminal communities. Since accomplishing a successful refund depends more on a vendor’s social engineering skills than on bypassing any particular type of anti-fraud measure, many vendors offer refunds for a variety of companies. Refund fraud is openly discussed on the underground forums and marketplaces of the Deep & Dark Web (DDW), where illicit vendors offering fraudulent refund services are commonplace. Equally these criminals are starting to not only gather mass following among those who want to copy their crimes but are also setting up “specialist” services to help these followers do just that. Cyber criminals’ capabilities are further advancing with digitalisation and they are now pursuing bigger and more advanced targets. The potential loss when you take into consideration fraudulent vouchers, fake goods and account take over, almost doubles. Research shows that online retail businesses lose approximately £500,000 per month due to fraudulent refunds. Thus, the fraudster receives their chosen product at no cost. After delivery, the actor falsely claims that the product never arrived, prompting the company to issue a refund. Refund fraud is a pervasive form of merchant abuse in which an actor purchases a product from an online store and has it shipped to their home or a drop site. Many online retailers have implemented generous refund or replacement policies to help improve the customer journey and generate loyalty, but unfortunately, these policies can be susceptible to various forms of merchant abuse. This is where recognising customer satisfaction as a key driver of retention is critical. As online sales in the UK rose by 3.6% in 2017, there is an ongoing need for online retailers to enhance their customer experience and in turn sustain rapid growth.
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