Nick Wells reported a story on CNBC.com with a headline suggesting online fraud is not a bad thing.
He comments on a report from Forter, an e-commerce fraud-prevention company. Forter monitors customer transactions to determine if the purchase may be fraudulent. Forter checks the device that purchased the item, the address it is being sent to, and other information. It will then approve or deny the transaction, based on machine learning and decision making.
The data in the report shows online fraud stabilizing at about 2% of all online transactions, or 98% of all transactions are legit. The report also mentions regular customers, who are technology savvy are taking advantage of coupon and referral promotions by using proxy and vpn’s to bypass authorization controls. Some referral bonuses include free giftcards or merchandise. Using these methods to circumvent the system is online fraud.
The story concludes with Forter CEO, Mickael Reitblat saying, “A little bit of fraud helps. As long as it’s controlled, it’s okay. It’s the cost of doing business.” What he means is that if a company closes down all fraud avenues, the customer will find it more difficult to make an online transaction, which will chase them away.
https://www.cnbc.com/2017/11/16/online-fraud-is-still-around-and-thats-not-a-bad-thing.html
Interesting article Fred. I am not really sure how I feel about Nick Wells’ statement. When he said, “It’s the cost of doing business.”, I completely agree with it. There are always risks making purchases online and one need to be proactive in paying close attention to what links you are clicking on and if the websites are legitimate. I don’t necessarily feel comfortable when he says “A little bit of fraud helps.” I personally do not want to be that 2% and I do not think anybody wants to. I am not that familiar, but possibly some fraud cases are easily solved, but what about the ones that are not? The ones where others are going months and months of trying to get everything resolved.
I have to agree with Elizabeth. Just because the fraud occurring benefits the consumer instead of them being the victim doesn’t make the fraud ok. In the same vein, just because brick and mortar stores plan and budget for shrinkage doesn’t make stealing from them ok, no matter how large and greedy the retailer may be. Fraud is a cost of doing business that retailers and consumers should plan for, but I don’t think it is ever ok to just accept that that is how things are. They should plan for if it happens but take steps to prevent it from happening in the first place.