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  1. #1

    Question Phone verification - is it actually useful for fraud?

    Hello,

    We have never used phone verification, since we manually call instead to do fraud checking.

    However, demand is now getting higher for our service and so we're thinking of automating this.

    The problem is that we have never had a single instance where fraud was determined, based solely on a telephone call being answered.

    It would be different if we could call the phone number actually associated with the credit card account... but all these auto-phone-verification systems do is phone whatever number is specified during signup.

    So why would a fraud person use a non-valid number?

    If you use auto-phone verification, have you found that it actually does decrease fraud? Is this just an opinion, or can you actually quantify your belief?

    To me, it just seems like an extra step that normal customers must suffer through, and it really does not add much protection since the good fraud scammers will certainly use a phone number they can answer and pass the validation with.

    ??
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  2. #2
    Join Date
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    We do that for dedicated server customers or when we feel that the customers' details are suspicious, it is really helpful. Just telling a scammer that you will be calling them can just make them disappear. I find that it is one of the most effective, not those automated systems but actual call to see if the customer is who he claims he is.

  3. #3
    Join Date
    Sep 2007
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    1,016
    We also use Telephone verification on some orders. As Boonchuan said, just the idea of being called can reduce some fraud. Another effective way to use the telephone verification is what MaxMind have used.

    Along with just calling the customer, the call also determines what type of phone/line it is. If its a Land Line, Mobile, voIP and more. Generally, Land Lines are very easy to trace and there for, easy to catch the fraudsters. But disposable lines such as pre-paid mobiles and voIP lines are harder trace. That is why MaxMind allow you to block verification calls being passed if they are verified by these types of lines.

    So to answer your question, automated telephone verification definitely helps against fraud.

  4. #4
    Join Date
    Oct 2007
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    I always wonder, for automated phone verification, what would happen if the client doesn't speak English? Many people can read but not understand it when listening to it. I guess the companies using this service are not targeting the international market.
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  5. #5
    Join Date
    Aug 2005
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    I am sure the people sign up a service reading English web site can answer the verification phone call, that just require to answer in yes or No.

  6. #6
    Join Date
    Oct 2007
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    I don't know if you use such a service yourself, but of those I have come accross believe me it is not as simple as yes or no
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  7. #7
    For hosting packages it would be a waste, but if you plan on doing dedicated servers its always a good idea to make sure all personal information is correct. Those Dedicated Servers chargebacks are nasty.

  8. #8
    Join Date
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    Well for us we do it for dedicated servers and those shared accounts orders that does not pass through screening, but mostly the calls are made for the dedicated servers as these are the most expensive stuff for chargebacks.

    Quote Originally Posted by Hostevery View Post
    For hosting packages it would be a waste, but if you plan on doing dedicated servers its always a good idea to make sure all personal information is correct. Those Dedicated Servers chargebacks are nasty.

  9. #9
    Join Date
    Sep 2004
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    Chennai , India
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    Quote Originally Posted by boonchuan View Post
    Well for us we do it for dedicated servers and those shared accounts orders that does not pass through screening, but mostly the calls are made for the dedicated servers as these are the most expensive stuff for chargebacks.
    Its a good practice to make a call back to the customer for verification. But has any such calls turned out to be potential customers? I mean the susp ones.

  10. #10
    Join Date
    Apr 2007
    Location
    New York
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    YES IT IS! I personaly use it and it cuts down on fraud by ALOT

  11. #11
    Its vital for accounts that fail our intial fraud tests, It realyl does get rid of the fraudsters and it means we get clients that are geniune that might have been wrongly marked as high risk.

    Well worth it.
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  12. #12
    Join Date
    Sep 2003
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    Washington, USA
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    In my experience I've found that automated phone verification is hardly a replacement for manual phone verification. If you manually screen any suspicious or high value orders manually by phone, you'll almost never have to deal with fraudalent orders.
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  13. #13
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    Mar 2002
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    Phone checks do help reduce fraud, it's another hoop the fraudster has to jump through and they're more likely to move on and bother an easier target.
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