Assessing orders for fraud.


4th December, 2019

How to assess your orders for potential fraud

With new ways to scam and defraud people appearing all the time, you’ll want to make sure your business processes are watertight. Here’s how to remain vigilant against fraud.

Earlier this year, the Australian Competition & Consumer Commission (ACCC) announced it projected Australians were set to lose around $532 million to scammers over the course of 2019.

The figures, based on losses already reported to Scamwatch and other government agencies, includes money lost by consumers and businesses alike.

And while most business owners operating in the high street may be wise to more traditional fraudulence and confidence trickery, new types of scams continue to catch them out.

That’s because innovative scammers are constantly seeking new ways to commit fraud – often utilising new technologies – with a view to rip off hardworking Australians.

Whether you’re a retail business or a sole trader, if you make or take payments online then you are vulnerable to fraud.

First steps to preventing fraud

If you don’t have the luxury of employing fraud-prevention specialists or acquiring enterprise-level solutions to do the job for you, you’ll want to start putting processes in place that minimise your risk of being defrauded.

Small businesses are particularly vulnerable, as they don’t always have the ability to spend time and resources on properly identifying legitimate sales and customers – but there are simple steps you can take without breaking the bank.

The simplest way to spot potentially fraudulent orders is to put a review process in place that will highlight anomalies and inconsistencies.

Some things to watch out for:

  • Abnormally large orders from new customers
  • Express shipping on unusually large orders or high-priced goods
  • Multiple customers shipping to the same address
  • Obviously false information, e.g. email addresses like ‘’
  • Customers who can’t answer all billing questions (particularly information that only appears on their card)
  • Billing and shipping addresses don’t match
  • Orders paid for with multiple credit cards
  • Unusual requests from new customers e.g. “Can you cover the freight costs upfront and I’ll pay you back on receipt of goods?”
  • Customers that overpay invoices by a large amount using credit cards before asking for the excess to be transferred into their bank account
  • Sudden, large volumes of transactions from a location you don’t regularly ship to

None of these red flags necessarily point towards intended fraudulence, but they should motivate you to contact the customer directly and ask for more details.

Smell a rat? Here’s what to do if you think someone’s trying to defraud you

It’s important to have an action plan in place in case you suspect an order is fraudulent.

The following three steps should form the basis for your plan of action, which you and all relevant staff should be familiar with in order to minimise your exposure to fraud.

  1. Verify the shipping address and phone number are correct by using an online directory
  2. Call the customer and verify their information before you ship. Ask for complete names, address, post code and phone number as they appear on the order
  3. If you can’t get a hold of the customer and can’t validate the details any other way, consider cancelling the order with an email to the customer explaining why.

Just as was the case in the old days of con artists and tricksters, getting a feel for what a valid order should look like will go a long way to keeping your revenue protected.

If you see something that doesn’t look right, you should take proactive steps to get to the bottom of the matter, and that mostly comes down to properly identifying your customers.

For further information, subscribe to the ACCC’s Scamwatch email alerts, and report instances of online credit card fraud to the Australian Cybercrime Online Reporting Network.