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  1. #1
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    Mar 2003
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    High risk orders?

    I keep reading high risk orders -> China

    What other countries are considered high risk orders? And if Hong Kong are considered?

  2. #2
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    A lot of business with Hong Kong and China as well.
    Many fraud attempts from Pakistan, India as well but a lot of customers from there also.
    So you just need to check every order and make sure it is legit.

  3. #3
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    High risk order could be from any country. It does not necessarily mean they are coming from China or India. Just make sure you have proper safeguard in place to avoid them. Countries such as China, India, Nigeria, etc. They have a higher number of fraud orders. Take a look at Maxmind it should help you with high risk countries and a simple Google search will show good results.
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  4. #4
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    Quote Originally Posted by iwod View Post
    I keep reading high risk orders -> China

    What other countries are considered high risk orders? And if Hong Kong are considered?
    South & North Korea, India, Iran, Afghanistan & many african countries including Nigeria, Somalia etc

    But I believe there should be no stereotyping & high risk orders can be from any country.

  5. #5
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    Speaking from experience:

    Pretty much every country in Africa. A lot of Eastern European countries. A handful of Asian countries such as China, Hong Kong and Indonesia. Pretty much every South American country.

    A better way to gauge if a country is high risk or not, is if you would want to live there for a year on the outskirts of a random town. I am being serious! No, I sure as hell would not want to live in any of the countries mentioned above. Why? Because there is a ton of poverty and a ton of crime. Guess what! That translates onto online in every respect.
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  6. #6
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    Jul 2013
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    The fraud order can be placed from any location using proxy server or VPN network. The best way is to have a verification syste, based on IP and phone or manual verification per order. If you block all high risk country order you loss more legit customers.

  7. #7
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    Another big one is Egypt.

  8. #8
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    Mar 2011
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    130
    There are many "End-user" came from China and they are fraud order, you will refund request.

    For my live experience, please call back the buyer telephone number. the country code from China is +86, they are most use HongKong as their "proxy" location to get a better reception score. Because now HongKong is belong to China, China mainlander are very easily to get a address in HongKong(or use a fake address).

    Hong Kong country code is +852
    China is +86

    You can try to send a SMS for mobile check.

    Also check their Credit Card. In China, they don`t have CreditCard like AE , Citibank. They are using their Chinese Bank without international payment function.
    You can ask them to scan a Credit Card cover to make sure they are a real man.


    It just my two cents.

  9. #9
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    Quote Originally Posted by Patrick View Post
    Speaking from experience:

    Pretty much every country in Africa. A lot of Eastern European countries. A handful of Asian countries such as China, Hong Kong and Indonesia. Pretty much every South American country.

    A better way to gauge if a country is high risk or not, is if you would want to live there for a year on the outskirts of a random town. I am being serious! No, I sure as hell would not want to live in any of the countries mentioned above. Why? Because there is a ton of poverty and a ton of crime. Guess what! That translates onto online in every respect.
    Patrick,

    That is a different way to put it.

    Chris West from CDG Commerce was doing a webinar a few years back, several of the countries you listed where rated in the High Risk for Visa/Mastercard with 70 - 80%+ order fraud rates.

    With those type of numbers statistically across the board, it is really hard seeing the whole country worth accepting orders from with the potential costly downsize of missing one of them.
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  10. #10
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    Quote Originally Posted by Zachary McClung View Post
    With those type of numbers statistically across the board, it is really hard seeing the whole country worth accepting orders from with the potential costly downsize of missing one of them.
    Patrick & Zachary, I agree, but not entirely. There are definitely legitimate businesses in these countries where orders can and should be accepted. I would never automatically decline, but I would tend to more highly scrutinize any orders risk score from these locations.

    I know you mentioned South American countries, but in particular, Brazil.
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  11. #11
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    Jan 2010
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    East Lansing, MI
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    Question for providers. Is there anyway to safegaurd yourself in regards to the payment? Obviously fraud detection for new accounts should be used, but what about after that and when you receive payment? Some type of extended verification period while you wait for the money to clear? Fraud insurance? Better payment methods and paying in advance?

  12. #12
    Quote Originally Posted by Zachary McClung View Post
    Patrick,

    That is a different way to put it.

    Chris West from CDG Commerce was doing a webinar a few years back, several of the countries you listed where rated in the High Risk for Visa/Mastercard with 70 - 80%+ order fraud rates.

    With those type of numbers statistically across the board, it is really hard seeing the whole country worth accepting orders from with the potential costly downsize of missing one of them.
    It all depends what you should consider as a risk. For example we don't care about charge-backs, because if order fails to pass verification we refund right away and typically we don't need to do any arrangements / purchases for specific orders. Because of this we have no losses for fraud orders and banning countries is something what totally makes no sense for us.

    In contrast we have very good relations with some clients from China, Vietnam, Turkey, Belarus, Ukraine, Russia, India and I can't even imagine growing our business without them.

    90% of our fraud orders comes from US ID-theft clients who purchase servers for spamming. Absolute leader in this is Florida. These guys found a way to steal real people IDs and credit cards, so standard verification is quite problematic.

    In other words it is not a problem which is bound to any specific country and putting it in that way is not a solution and just makes you _feel_ safe.
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  13. #13
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    Quote Originally Posted by alnitech View Post
    It all depends what you should consider as a risk. For example we don't care about charge-backs, because if order fails to pass verification we refund right away and typically we don't need to do any arrangements / purchases for specific orders. Because of this we have no losses for fraud orders and banning countries is something what totally makes no sense for us.

    In contrast we have very good relations with some clients from China, Vietnam, Turkey, Belarus, Ukraine, Russia, India and I can't even imagine growing our business without them.

    90% of our fraud orders comes from US ID-theft clients who purchase servers for spamming. Absolute leader in this is Florida. These guys found a way to steal real people IDs and credit cards, so standard verification is quite problematic.

    In other words it is not a problem which is bound to any specific country and putting it in that way is not a solution and just makes you _feel_ safe.
    Every business has their relationships and tolerance to certain factors. At this time, we only have one country we have a 0 tolerance for due to their rates of fraud.

    Time/people is one of the top costs (if not the top cost) for every business in this industry. As a business it is up to you to say hey does spending $xxx processing these $x,xxx orders per month from this country where $x,xxx is fraud worth our time.

    Then the question becomes since we aren't 100% at catching fraud is the x% of charge backs that get through which have $xxx in additional cost of time of dealing with the charge backs, tech support, billing time, etc. really worth the net we made.

    Each business is going to have a different answer to that based on what they sell, how much operations costs, etc.

    I think what Patrick and I are ultimately getting at, it is hard to see that equation working in a positive direction for anyone with an 80% fraud rate from a country such as Nigeria.

    Spammers and Florida, I've dealt with those at a past job. Typically a phone call quickly solves those (or any fraud).

    Have to feel for those who have their identities stolen.
    Last edited by Zachary McClung; 01-03-2014 at 02:31 PM.
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  14. #14
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    *

    Lot's of fraud orders from USA and Canada ( I believe, that they using USA/Canada proxy only ).

    Also problems with Egypt, Pakistan, China, Indonesia and Poland (strange for us ).

    Never had problems with Russia, Ukraine ( Why companies are afraid of them? ).
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  15. #15
    Quote Originally Posted by Zachary McClung View Post
    Time/people is one of the top costs (if not the top cost) for every business in this industry. As a business it is up to you to say hey does spending $xxx processing these $x,xxx orders per month from this country where $x,xxx is fraud worth our time.
    Not sure from where you got these proportions first and second i am very skeptical that you receive $x,xxx orders per month from any single country in Africa. I assume that we are talking about $100/monthly products since we are in "dedicated server" brunch.

    We pay salary to a person who is responsible for this and we just don't care whether he spent 10 or 30 minutes (these are real figures) per day for orders verification or he spent same time reading WHT. If we will need a dedicated person for this, I would say i don't care again, because in this case we are most likely getting around $3M of monthly new signups.

    Then the question becomes since we aren't 100% at catching fraud is the x% of charge backs that get through which have $xxx in additional cost of time of dealing with the charge backs, tech support, billing time, etc. really worth the net we made.

    Each business is going to have a different answer to that based on what they sell, how much operations costs, etc.

    I think what Patrick and I are ultimately getting at, it is hard to see that equation working in a positive direction for anyone with an 80% fraud rate from a country such as Nigeria.
    I think you definitely need to spent more time on the issue, instead of banning countries if you are still getting $xxx in charge-back fees monthly. I can't even remind our last chargeback... maybe half a year ago and we refunded it before we got it, so no fees where applied.

    Spammers and Florida, I've dealt with those at a past job. Typically a phone call quickly solves those (or any fraud).
    Unfortunately phones calls do not solve anything now since VoIP is more and more popular. We tried this and yes, they are answering the phone and saying that everything is OK. We found our own ways to handle this, so it is not a big problem now, however it is still the biggest fraud region we see.
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  16. #16
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    We have seen a ton of fraud orders from Turkey where they try and do a chargeback 20+ days later. It's forced us to implement additional measures when accepting orders from Turkey because like with any country you do get legitimate customers too!
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