Fraudulent transactions approved by square & we are responsible

[Thecottagejc]

Hi everyone! We use square as processor and had them set up an online store for with delivery for our cafe. We had almost $800 in orders from various customers (which ended up being 1 person) and they stole credit card numbers and placed orders over 3 weeks. Well we just got charge backs and square is saying there is nothing they cam do and we are out the $800. Does anyone have any insights or help with this? Thanks so much! I feel like they allowed the transactions to go through with the wrong info so they should be liable. They offered a paid service to make sure it doesn’t happen again but shouldn’t they have had this to begin with?

[sweetcharms]

following this one-we just received a fraudulent order as well today and immediately put through a refund. Because of this we now have to prove we are a legit business and upload documents etc. I switched to square because I heard they were more secure and now I'm dealing with them same thing all over again.

[Frida]

Hello @sweetcharms,

Good to see you posting int he Seller Community for the first time. 😊 Sorry it's under these circumstances. I wanted to address a few things here.

The unfortunate reality here, is that regardless of card processor, chargebacks and fraud can occur.  The only certain way to avoid any risk of this nature is by only accepting cash. This does put alot of limitations on a business however.

I wanted to offer up some ideas on what you can do to protect yourself. We offer great resources to assist you:

Risk Manger: This subscription offers you to flag potential fraud with online store payments. 

Tips on preventing disputes:   This article offers great advise on what preventative measures you can take on your end in the event this occurs again. 

Square Contracts:  There are about 5-6 customizable templates you can use here to attach to payment transactions.

I hope I provided some helpful guidance here, please do not hesitate to ask any other questions.  I look forward to your response. 😁

[sweetcharms]

Hi Frida!

Thank you for your replay! These are very useful ideas and I will absolutely read the article and look into the manager.  It's so frustrating especially for online businesses where we can't accept cash! Is there a way to block customers?? It's the same person ordering from me!

And no matter the card processor the banks will always side with customer which is equally not fair if you have all the documents proving otherwise.

Again though thank you for your respone!

[VanKalkerFarms]

This is where the fun of the internet and people wanting to scam people gets fun, or actually really not fun.

At the time of purchase, everything appears fine during checkout, name, zip, card number etc.  But days or weeks later the actual owner of the card sees a charge and then files a dispute.  There isn't a way to know that someone had a copy of the card and was using it maliciously.  There also is the scammer who uses their own card and then claims that they didn't make the charge.

There isn't a ton you can do.  If it is something that happens a lot, different types of websites see more fraud activity than others, there are companies that offer dispute insurance.

[sweetcharms]

I have to read about that dispute insurance because that it something I'd like to get! So frustrating but there's only so much you can do!!