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Antifraud Regulations May Cause More Online Fraud

Chargebacks911® Exec’s Monthly Column for Newsmax Finance Warns of Increased Risk

In her monthly guest feature for Newsmax, Chargebacks911 COO Monica Eaton-Cardone warns the “culture of instant gratification” surrounding eCommerce may cause some problems.

eCommerce is a fast-growing market. While that’s great news for online sellers, it does entail some drawbacks. Specifically, consumers’ expectations of a simple, frictionless experience are causing fraud incidents to increase. “Consumers are accustomed to doing very little in the actual verification process,” Monica explains. “While the average internet user is acutely aware of the risks posed by identity thieves and other bad actors, they often neglect to act in a responsible or informed manner.”

More consumers find themselves duped by phishing attacks and other fraud threats as a result. When that happens, liability ends up pushed onto eCommerce merchants.

Monica suggests that the present state of consumer entitlement is creating a toxic environment for online retail. If we don’t take steps to rectify the problem soon, it will create ever-more massive problems down the road. But, to achieve change, merchants need to take the lead.

“This calls for businesses to engage fraud by separating disputes based on their primary sources: criminal fraud, friendly fraud, or merchant error. All chargebacks should fall under one of these three.” Once merchants can separate these three sources, it’s possible to tackle fraud.