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Friendly fraud presents a unique challenge because the legitimate cardholder is typically the one initiating the transaction, making it difficult to identify at the point of charge creation. The recommended approach focuses on robust preventative measures:
  • Information Collection — Gather comprehensive data during the charge creation process to establish a clear transaction record.
  • Clear Communication — Clearly communicate shipping times and/or billing terms to ensure cardholders understand what to expect.
  • Agreement Documentation — Require cardholders to formally accept your terms of service before completing their transaction.
  • Shipping Verification — Ship exclusively to addresses that match the verified billing information on file.
  • Delivery Confirmation — Consider requiring a signature upon delivery of goods as proof of receipt.