Unfortunately, scammers are getting ever more prevalent and creative with their tactics for targeting businesses and individuals. It is however very important for pet care teams to be able to work with new customers on a regular basis, but how can you know which individuals may not be true customers? In this guide we will explore some red flags to look out for when working with new clients to help keep your business safe.
1. Requesting a refund via a different payment method
One of the most common scams used to target businesses involves an individual charging their payment to a stolen credit card then requesting a refund via a different payment method (i.e. etransfer, Venmo, cash, etc.). This means that, when the stolen card is reported and the illegitimate charges are disputed, your business will be out the money that was returned. As such, it is always recommended to only provide refunds to your clients using the same form of payment that was used for the original charge.
This also applies to requests from customers looking to have you overcharge their card then send funds to another party. This is never recommended as it likewise allows the individual to get funds from your business then when a chargeback is submitted for the initial payment you will be unable to recover the transferred funds.
When managing Stripe payments on your account, you can provide refunds easily from the associated invoice's information page. For detailed instructions on the refund process for Stripe payments, see our help guide on Processing Refunds.
2. Zip code associated with their card differs from their provided address
Since scammers generally make payments using stolen card information, the postal/zip code used to submit their payment may differ from their address. If a customer asks you to submit their payment for them, especially for large payments, it is a good idea to confirm their address prior to proceeding with the charge.
As a general rule, it's a good idea to have your clients submit their payment information themselves as much as possible. This allows for the system to automatically catch and prevent potentially fraudulent charges. Putting payments through for a client can allow them to circumvent some of those safety features since the charge will be put through using your IP address instead of theirs.
3. Inconsistent information
When dealing with scammers, their provided information may vary significantly over the course of your conversation. This can include information they have provided about the pets they are looking to register with your businesses (name, age, breed) or their contact information (email address, phone number, address), and more. You may also notice that the name they provide does not match their email address (i.e. John Smith with the email matthewspencer@mail.com) or they may provide a suspicious email (i.e. ghfujalhglufa53j4i5@mail.com) or phone number (i.e. 555-555-5555 or 123-456-7890).
Additionally, if the client is asking to split payments over multiple cards that have different postal/zip code information, it's possible that they may be using stolen data to make their payments.
4. Unusually large purchases
If a customer has continued to submit significant payments but has not yet taken part in any of the services provided by your business it is possible they may be submitting fraudulent charges. It is highly unlikely that a client will happily continue making large payments towards a service that has not yet been provided by a business. This is especially true when a customer makes several large payments over a short period of time without any services rendered.
Note that the amount constituting a "large purchase" will differ depending on your business. A good litmus test is to compare the charges to purchases commonly made by your clientele. If the value is significantly higher than usual, especially over a short time period and without having met the client in person, it may be a good idea to check for other red flags indicating possible fraudulent behaviour.
5. Strange communication
Many scammers also use pre-written responses, so their communications may feel somewhat disjointed or scripted. If ever a customer's response feels strange to you, you can try copying it and pasting it into a search engine (i.e. Google) to see what comes up. Since scammers will often re-use the same messages, searching their responses in this way can provide you with insight on whether that specific wording has been commonly used elsewhere.
6. Repeated failed payments with different cards
Customers with multiple failed payments combined with new payment information being provided following each failure are more likely to be submitting fraudulent information. It is common for scammers to have stolen data from multiple different credit cards. As such, they may attempt to use various cards, continuing to provide information until they find a card that works. That allows them to determine which cards are usable, and which may have been cancelled or reported as stolen. The more times a client has switched to a new card following a failed payment attempt, the more likely that their card information is fraudulent. This is especially true if the card numbers are all very similar.
Additional details on protecting yourself and your business from fraud can be found in Stripe's help article on Identifying potential fraud.