As online sales and omni-channel buying continue to grow, fraudsters are setting their sights on online fraud as their primary source of income. While fraud is a crime and merchants are victims, law enforcement hasn’t kept up with the demands of cyber security to investigate and prosecute online fraudsters. So, how do fraudsters get caught? Given the seemingly anonymous and cross-border nature of online fraud networks, you may think there’s little you can do to get justice. But there are steps you can take to help build your case and make it more compelling for law enforcement to take action.
Step 1: Merchants matter
Evidence can be very tough for law enforcement to come by in cases of online fraud, making prosecution much more difficult. As merchants, you have access to a treasure trove of data that just may reveal a smoking gun that could lead cops to a capture. Transaction details like cardholder name, delivery address, IP address, email exchanges or recorded customer inquiry phone calls can all help the police narrow down their suspect pool.
Step 2: Call the correct police department
Instinctively, since you are a victim of the crime and it’s your livelihood that’s stolen, it makes sense to assume the crime happened wherever you are, but legally that is not the case. The city in which the crime took place is the city whose legal authorities hold jurisdiction over the crime, meaning if you are based in Omaha, NE and the thief appears to be based out of Portland, OR, you need to contact the Portland police department.
Once you’ve established fraud has certainly taken place, you need to determine where the package was shipped and reach out to local authorities in that area. While you may want to reach out to your local authorities or a federal agency such as the Department of Justice or FBI, you’ll be led through a maze of red tape that lands you back to the city where the crime took place, which is where the order was shipped.
Step 3: Connect a thief to the crime
Though it’s hard to accept, almost every other class of crime takes precedence over online fraud for law enforcement. Thus, it’s important to provide officials with a name they can associate with a bogus address. Without a valid name to compare against stolen packages, nothing found will hold up as evidence for a conviction. The police need to be able to connect the thief to the crime.
Step 4: Document your losses
Vigilant merchants must keep detailed records of their losses. Professional fraudsters are expert criminals who get better with practice. They likely have a trackable pattern that might elevate the statute of the crime and pique the police’s interest. Showing repeated thefts with the same contact details like name, email, phone and address can reveal several crimes from one individual. In a court of law this translates to a criminal who repeatedly and willfully sought to steal from the merchant, making a case more prosecutable as wire fraud.
Step 5: Check eBay, Craigslist and other marketplaces
Time is of the essence for fraudsters who need to unload their stolen goods before authorities catch wind of their antics. Online marketplaces provide easy access for quick transactions on items with high resale value. By browsing online marketplaces for your stolen goods, you can match the items stolen to what’s being sold. You can compare shipping addresses and use postings to track the thief. For safety reasons, you should never pursue a fraudster on your own without help from officials, but your proactive assistance will likely be the critical factor that helps law enforcement build a case.
Step 6: Be proactive and patient
The irony of ecommerce fraud is that while it can happen in seconds the process to recoup your losses and get justice against a fraudster will almost always move slowly. It may take several follow ups with investigators before you begin to make any headway, but don’t give up. A persistent effort with complete records to back up your claims may be what’s needed to set you apart from other cases.
Step 7: Set realistic expectations
The amount of work required and the low success rate for online fraud cases makes this type of crime less attractive for prosecution. And when other countries get involved the resistance can be even greater. Unless you’ve suffered a multi-million dollar loss, it will be hard to find officials in developing countries willing to invest to track down stolen packages.
But don’t let your entrepreneurial spirit and need for justice wane. Countries like New Zealand, France, Canada, the United Kingdom and the United States have advanced record-keeping protocols and data-tracking capabilities. In the US more states are allocating budget towards cyber crime police units. If business owners can follow steps 1 through 6 and gather as much evidence as possible, justice may become more attainable.
The long con requires the long haul
Fraudsters commit extensive time and effort to perfect the untraceable art of online fraud. The FBI outlines the difficulty of prosecuting fraud on their website. The more corroborative evidence merchants can provide to authorities to prove a crime has occurred and establish a connection between the crime and the criminal, the more likely the chances of legal success. Personal contact details, shipment details, purchase patterns and other data or anomalies can help investigative efforts. But merchants need to be patient and persistent as they’re fighting an uphill battle when it comes to prosecution for online fraud.
Until the legal system catches up with the sophistication of online crime, merchants must learn to defend themselves against sophisticated networks of fraud syndicates operating in unison as seasoned professionals. Signifyd can help by guaranteeing protection for merchants against chargebacks and eliminating fraud upfront. Leverage our real-time machine learning across our 5,000+ merchants to use data from fraud against fraudsters. Let Signifyd fight fraud for you while you focus on building your business and taking care of your customers.