• Signed Contracts
• Signed Terms of Service
• Detailed Description of the Product(s) Ordered
• Signed Proof of Delivery/Delivery Tracking
• Pictures of the Shipped Product(s)
• Detailed Description of the Product(s) Shipped

Please contact 2Checkout.com’s Dispute Department at chargeback@2CO.com for additional documents accepted based on the nature of your business.

All types of e-commerce companies have dealt with friendly fraud at one time or another. Within the past few years there has been an increase in deliberate friendly fraud. There are a few factors that have contributed to the rise in deliberate friendly fraud; such as the shape of the economy worldwide, individual financial situations, and consumer’s knowledge of how to take advantage of the banking system. Unfortunately, the economy can impact a person’s financial stability which can cause this type of deliberate fraud. What someone can afford today, they may not be able to afford tomorrow. This can lead them to drastic measures to hold on to any funds they have.

Another type of friendly fraud are fraudsters that regularly manipulate the system to get their products for free. Since these fraudsters are constantly finding new ways to use the system to their advantage, there is no real way to avoid this type of friendly fraud from happening. Basically the only thing that can be done is to try to protect your business as much as possible.

Accidental friendly fraud is when the consumer mistakenly disputes a charge and doesn’t take the incentive to rectify the situation. In many cases it can be helpful to contact the customer directly to give them additional information about the charge and the product or service that was purchased. Accidental friendly fraud can be easily fixed. Once the consumer realizes they made the mistake, they remedy the situation. The following suggestion may help to avoid this type of friendly fraud. If your business uses a reseller, a payment processor, or any type of third party billing service; such as 2Checkout.com, PayPal, Clickbank, WorldPay, or Google; it is very important that your customers are aware of this. Placing this company’s information on your website and on your receipts will help customers recognize the charge on their billing statement. An additional feature available to 2Checkout.com suppliers is the use of a “soft descriptor”. Each supplier can enter their own “soft descriptor” to be included within the description sent to the credit card companies when a credit card is billed.

With all of this in mind, before you send a product or provide a service to a customer, make sure you know the customer. If you don’t know them or are skeptical, use the tools on the internet or any other tools made available to you in order to screen the customer. You may request that the customer fax information to you such as their photo ID or a utility bill. Additionally, you may contact the Fraud Department to request that 2Checkout.com require additional documentation from the customer before providing the item(s) ordered.

These preventative methods may lower the chance of receiving a fraud related chargeback. However, even with doing all of this, there is really no way to predict cases of friendly fraud. It is a good idea to prepare your business for these special cases. The best way to prepare is to keep all documentation about the customer, the product/service that was provided, and any contact you have had with the customer; as these may be needed to challenge a chargeback. Some examples of documentation you should retain are:

• Proof of Successful Download
• Proof of Product Usage (Login, IP, etc.)
• Signed Terms Of Service/Contract
• Signed Proof of Delivery/Delivery Confirmation
• Tracking Pictures of Shipped Products
• Detailed Description of Product

Since there is no real way to stop this type of fraud from happening, a good business practice is allocating funds to offset any possible losses due to all types of friendly fraud. This can help ensure your business continues to grow while you are trying to recoup the loss of funds from the chargeback. All online companies spend time and money looking for fraud, but fewer companies spend enough time gathering the information required to fight friendly fraud. As this is “Fraud Awareness Week” we decided to take this opportunity to remind you that friendly fraud is out there and can negatively impact your business. With all of this information, you can be better prepared to fight friendly fraud.

Amanda and Leona – Disputes Department

The first, and probably the most important, is good customer service. Reply to customers contacting you directly or contacting 2Checkout.com and provide assistance to those customers. If the specific issue that a customer is having can’t be resolved offer the customer a partial or full refund of their order. Take advantage of our Customer Care Center by posting our contact information on your website.

The second thing that merchants can do to decrease disputes is to confirm that the customer received the order and that they were satisfied with the product/service they received. This can be done several different ways and depends on the type of product being sold. For tangible goods get tracking numbers on shipments, send those tracking numbers to the customer, and after the order is delivered contact the customer with a short email asking them to confirm that they received the item and that they are satisfied with the product. For intangible items such as software, memberships, and hosting service send the customer an email asking that they let you know how the product is working or asking if they have any questions about accessing the service.

It is also important that merchants review their incoming orders. Conduct your own fraud review and contact our fraud department at fraud@2CO.com if anything looks suspicious. The fraud department can review the order or contact the customer for further verification if needed. Also, watch for multiple orders placed with the same customer information within a short period of time. Simply canceling duplicate orders that are placed mistakenly will lessen disputes.

For more helpful hints about lowering chargebacks please review the article, How can I help to reduce the number of customer disputes?, in our knowledge base.

As everyone knows, nothing has 100% guarantee and a chargeback could still occur. For each chargeback that 2Checkout.com receives the credit card provider charges a fee. Some of these fees are passed on to you. If a chargeback does occur and you would like to challenge it, please contact our Dispute Department for assistance. When contacting our Dispute Department please provide all documentation that you have regarding the chargeback. The Dispute Department will review the information and notify you if the documentation is sufficient enough to challenge the dispute. If the documentation is nonsufficient, we will explain why in hopes of making you better prepared to challenge any other chagebacks.

2Checkout receives notification from the credit card provider that an account holder has initiated a dispute. The type of payment method or the location of the card issuer that was used to make the purchase will determine the type of chargeback that is received. The notification we send will contain detailed information regarding that specific chargeback, what documents are needed to challenge the chargeback, and when the challenge process takes place. Since there are different types of chargebacks and alternate ways for representing chargebacks, it is important to carefully, and thoroughly read each notification that is sent from 2Checkout’s Disputes Department. Once you have received the notice of a chargeback or an incoming chargeback, you can do one of the following.

1. Let the dispute stand.
2. Contact the customer and try to resolve the dispute.
3. Contact 2Checkout for assistance with challenging the dispute.

If you decide to challenge the chargeback, a response to the Disputes Department is needed within 7 days of receiving the chargeback/incoming chargeback notice. The response should include all necessary and appropriate documentation to challenge the chargeback.

Completed chargebacks from banks outside of the United States cannot be disputed after the retrieval time-period.

2Checkout.com occasionally receives notification from the credit card provider that the account holder is inquiring about a charge. On behalf of our merchants, 2Checkout.com will send a copy of the receipt to the credit card provider at no cost. 2Checkout.com will also inform the merchant of the inquiry to give them the opportunity to contact the customer to resolve any possible issues that could result in a chargeback.

If there are any questions about the chargeback process, please contact the Dispute Department by email at chargeback@2CO.com or by using the contact information provided here.

The most common reasons for chargebacks are:

• Account holder’s credit card number was compromised or used without the account holder’s permission.
• Account holder does not remember the purchase or does not recognize the charge on their statement.
• The customer mistakenly placed multiple orders.
• The customer was not satisfied with quality of the product/service that was received.
• The customer was advised that they would receive a full or partial credit and that credit was not successfully issued.
• The recurring billing was not stopped at the customer’s request.
• The customer did not receive the product/service that they ordered.

There will be a $50.00 USD fee for receiving a fraud related chargeback for any order that a vendor requests to be reinstated after it was failed by 2Checkout.com’s fraud department.

If a vendor would like to challenge a chargeback all documentation must be sent to 2Checkout.com’s Dispute Department for review. If 2Checkout.com decides there is a solid case to present to the credit card provider, the vendor will have the option to challenge that chargeback. The credit card provider charges a fee for challenging a dispute; this fee is passed on to the vendor and is non refundable. The fee to challenge a dispute is $15.00 USD.

The amount of disputes you experience will vary according to the type of products you sell. Products that will experience a higher degree of chargebacks are intangible and products that appeal to children, teenagers, and single adults. Products that will experience a lower amount of chargebacks are tangible products and products purchased primarily by professionals and families.