Card Fraud/Disputed Transactions/Risk Alerts

[FoundCoffee1]

Hey all, we've been targeted lately with a lot of disputed payments and what is seemingly credit card fraud through our online Square website. They are placing orders online with what is seemingly normal transactions, but then picking up [sometimes not, perhaps because they see security cameras?!] and then weeks/months later getting disputed charges, and then find it hard to prove the transaction is genuine. We've lost hundreds of dollars this month through this scam/scheme and Square support has basically said to setup Risk Alerts. It's quite confusing to figure out, anyone have any pointers on what rules to setup to minimise this?

[Breffni]

Hi @FoundCoffee1 👋 thanks for your post. 

This sounds stressful and I'm sorry that you are going through it. 

It sounds like we have suggested Risk Manager but you may not have set it up yet, is that right? I'll share some information:

Risk Manager is a tool that helps you spot and manage potential fraud from the online payments you process with Square. Watch a tutorial to learn more.

You can create rules in Square Dashboard to trigger your own fraud alerts, authenticate electronic card transactions with 3D Secure or to automatically decline suspicious payments. When you set up risk alerts, you can view additional details about suspicious payments, as well as options to issue a refund, block the payment card or dismiss the alert.

You also have the option to block emails, payment cards and IP addresses in Risk Manager. Keep in mind: blocking emails and IP addresses allow you to cast a wider net if you’re noticing a pattern of fraud across multiple cards. Learn more about blocking in our Support Centre.

Risk Manager is currently available for free for all Square sellers processing online payments via:

• Square eGift Card payments
• Third-party API integrations
• Online transactions on your Square Online website
• Square Online Checkout

 Although this tool is designed to help prevent payment disputes, the risk of a payment dispute is present with all card payments.

Let me know if you have more questions!

[SSC-Ganges]

I recommend turning off eGift card sales -- We are considering that for our business because of a security flaw for which Square is not taking responsibility. Worse, Square set up a dispute between us and the owner of the presumably stolen card -- Either they will have to pay or we will. It's a classic case of blame shifting and it makes Square look pretty bad. 

Here are the steps to scam the Square eGift card system:
  -  have some stolen credit card numbers…
  -  after hours, cycle through cards until one works to purchase a Square eGift card
     (In our case there were 2 failed card attempts before a third card worked, all in the same timeframe, for the same eGift card purchase -- That's a very rare combination and would be easy for Square security to detect and block… but they didn't)
  -  early the next morning, use the eGift card to make purchases
  -  a week or two later, the owner of the stolen card reports a charge they don't recognize
  -  Square sets up a dispute between us and the card owner… the loser will have to pay.
  -  Square takes no responsibility for their own failure to block an obvious card fraud situation