Require customers to provide an e-mail address issued by an Internet service provider, not a free e-mail service.Send e-mail verification to the customer after he or she places an order. Require the customer to reply and confirm the order via e-mail. This greatly increases the odds that whoever has access to the e-mail address is the same person who placed the order.Provide alternative methods of ordering, such as via telephone or fax, for those legitimate customers that have e-mail addresses with free service providers. At the very least, call the telephone number that the customer provides to verify the order.Consider shipping goods only to the address on file with the customer's bank or credit card issuer. Ask those who would like to send a gift to a different address to call in with their orders. Send a regular mail confirmation of a gift shipment to the customer's billing address as an additional safeguard.Hope these will help a bit, hard to answer but these could be good.

i think you need to deliver products to the address that are available in the PayPal account. It will be a better choice ---This post was edited to remove a commercial link. Read our discussion policies for more Community best practices.

To combat Internet fraud, I'd like to suggest free WorldIP geolocation database. Its based on data from the BGP tables routers and monitoring points around the world. Therefore, it is far much more correct than the other bases. They display geographic locations of network owners, and not the physical location of network itself. ---This post was edited to remove a commercial link. Read our discussion policies for more Community best practices.

Learn some internet fraud schemes here

This has become a problem, so I wait to ship anything out for 2 business days. Most people and cards are honest. I wish you all the luck.

Paypal does have some increased security measures but I don't think that would be sufficient, for instance the kids using parents cards would know every minute detail about operating parents card. The only way that we can reduce such cases is by imparting more security features, though it would take some time and would require more money but it would be worth it.   I think that teamextension have provided some good bit of security features that would ensure that the such cases are reduces to a minimum extent.

I've delt with this a good bit.   Paypal has SOME protections in dealing with CC fraud , if you sell on ebay , the rate of fraud is higher , but normally paypal will offer more protections.   You can attempt to get a full merchant bank backing, as they have even better fraud prevention than paypal , but there is quite a bit of documentation required for that.

Here's a few things you might want to look into to lessen fraud orders. Some were already mentioned above. 1. Make CVV/CVC mandatory. This will lessen fraud from people who stole card numbers but not the actual physical credit card. 2. Use AVS. This will lessen fraud from people who stole the card but don't actually know the person's billing information. 3. Use MaxMind. They have IP, BIN and email checking which alerts you of high risk transactions. 4. Support Verified by Visa and Mastercard Secure Code on your website. 4. Confirm orders over the phone before the delivering digitally. 5. Send a confirmation snail mail to the billing address. Include a code that they need to enter before the delivering digitally. 6. Do not deliver digitally to free web-based email addresses without extra confirmation. 7. Post a big warning message on checkout, diplaying their IP, saying you will report all fraudulent activities to the local authorities and IC3. Due to the nature of your business, you also have to be wary of kids using their parent's credit cards. The parents won't know what these charges are when they see it in their statements and they will have these charges reversed. I would also study the fraud charges in detail and see if you see pattern. It could be coming from a certain range of IP addresses. Or maybe a certain country. This will help you decide what actions to take next.

One of the best methods is to only allow shipping to the billing address of the credit card for 'first time purchases'. Almost 75% of the time the purchaser will have the item sent to there billing address. If they don't you can require additional verification.

First of all online fraud and online business are the two sides of the same coin. Well you can minimize the fraud by adding more security methods like Phone Verification By taking ID card proof for address By verifying emails personally These are the some basic techniques. You have to be alert else you will loose your business.