Fraud Is on the Rise. VineSpring Is Here to Help.
Accepting a credit card for a wine purchase online is a necessity for a winery. But outright fraud is on the rise and VineSpring is taking steps to help mitigate the risk.
Fraud typically happens when a nefarious individual obtains a credit card number that isn’t theirs and attempts to make a high-end purchase online. They ship the product to a temporary address (could be a drop off location like a locker at a Whole Foods or Walgreens) and then they resell the product on eBay, Craigslist, or any number of online marketplaces. Historically, fraudsters have stayed away from the high-end wine space (after all, it’s much easier to ship an expensive watch than it is alcohol), but lately, we’ve seen an increase in attempts.
VineSpring is directly integrated with Stripe for accepting, processing, and storing credit card transactions. Stripe provides a robust set of fraud detection and prevention tools through their service Radar. Leveraging the power of machine learning, Radar analyzes, compares, and assigns a score to every transaction processed through the Stripe network. This goes way beyond just your transactions, Stripe is analyzing all transactions on their network. Using literally billions of data points, Radar adapts to help ensure legitimate transactions are allowed and fraudulent transactions are stopped.
“When a business using Stripe sees a card for the first time, there’s an 89% chance that we’ve seen the card elsewhere on the Stripe network in the past.”
Let’s examine one transaction that was blocked on August 3rd, 2020—here’s is a screen grab from Stripe Radar:
The transaction was attempted for $1,196.03 worth of wine and the risk evaluation was 98—a very high score and almost certainly fraud. This credit card had never been used before on this client’s website, but Radar recognized the card from other merchants who reported it as fraudulent. In fact, the transaction originated from an IP address and location that is known to have fraudulent transactions in the past:
Having a system that proactively is monitoring the fraud risk of transactions is a necessity in today’s online world. Simple fraud rules are no longer enough—machine learning and adaptive, real-time risk analysis are critical in helping prevent fraud.
Remember, while Stripe Radar offers a greater ability to protect your business from fraud and disputes, you're ultimately responsible for payments you choose to accept. If you have any questions about the legitimacy of a transaction, do some digging to find out more before you ship your wine to them.
As always, VineSpring is here to help, and please don’t hesitate to reach out to us with any questions.
