Digital Footprinting to Lock Online Frauds

Apr 11, 2023by, Pooja S Kumar

Artificial Intelligence

Since the COVID-19 pandemic, eCommerce websites have seen an explosion of new customers searching for home delivery options. Cybercriminals have taken advantage of the growing demand for home delivery. According to a survey, retail fraud has increased by 50% between 2020 and 2021. This is bad news for online merchants of all sizes.

Although cybercriminals are upping their game and releasing more convincing fake and robbed personas, it is impossible for them to cover every base. All online customers leave a digital footprint behind, and no matter how hard they may try to appear as legitimate customers, fraudsters are unlikely to be able to produce convincing digital footprints every time.

Cyber crime, online frauds

For example, someone who uses a proxy or Tor client is more suspicious than someone who is not connected directly. Tor in particular is used by cybercriminals a lot, its use is certainly not sufficient to distinguish someone as one. Such configuration analysis is both good practice and a pillar of catching bad actors online. However, it is also useful to do the opposite. We should use digital footprint analysis to identify good users. We know what a legitimate user looks like and suspect those who deviate from that rather than the other way around.

Digital footprints are the public trails users leave behind on the internet. The digital footprint of a user includes the IP address, social media accounts, email addresses, phone numbers, avatars, location history, as well as other public information. For customers to purchase goods from your website, it’s necessary for them to fill in their details like email, phone number, etc. Even though their details aren’t genuine, fraudsters also fill them in order to run their schemes. They sign up for a free email account that uses part of the person’s name to impersonate them. Many fake accounts were created recently and lack the digital footprint of a real person.

Unlike us, Fraudsters use social media for fraud and not for hanging out on Facebook and Twitter. So using these details that they provide unknowingly we can see whether a user has zero digital footprints by conducting a reverse email or phone number lookup.

Integrating fraud detection with an eCommerce site

Few eCommerce websites integrate fraud prevention and detection software with their platform. Platforms like these offer fraud prevention and detection tools, but these are often not sufficient because they are too conservative, leading to false positives and loss of customers. This is particularly true for overseas orders, but more sophisticated fraudsters can also be able to obtain through platform-based solutions.

Data enrichment can give you a more complete picture of a customer’s overall digital footprint, whether you want to look up someone who seems suspicious or not, using batch data or as needed. With eCommerce platforms becoming more popular and fraudsters becoming more sophisticated in their methods, it’s worth investigating some of the key digital footprint techniques listed below.

That’s because you can tell when an email address or phone number isn’t associated with any legitimate online accounts. On the other hand, you can give customers a free pass even though they may be from a volatile region, but their online presence is suspect. This means more and more profitable sales. Reverse email and phone lookup methods can help us identify cybercriminals during a sale or even signup. They are unlikely to appear like your average, responsible customer if you look at their digital footprint.

Illustration of online activities that require payment

Digital footprint solutions such as the one used by SEON can be API-based or platform based. The functionality is also available as a Shopify app that provides a detailed customer profile as a result of its data enrichment software, giving you a completely transparent risk score for each one, indicating specifically why they are at a higher risk than they are and how this decision was made. This means that only high-risk clients must provide additional details during the transaction process so that you do not lose your low-risk clients.

Despite being a pain point in eCommerce, a chargeback is often justified, as it is the way customers can recover their money back if a merchant hasn’t sold them or if someone has stolen their card. However, friendly fraud occurs when a customer requests a refund even though they haven’t received their products or services as promised. This is the customer who wants their cake and eats it too, with the intention of both keeping the products and getting their money back by not being truthful about what happened. Merchants can contest a chargeback request through the chargeback recovery process in this situation. However, you will not be able to recover a chargeback by following evidence such as invoices for courier companies. As the odds are stacked against them, providing such proof is always a challenge for merchants.

In fact, it’s not unheard of to see these fraudsters raving about the fraud they did on social media. For example, they can be seen on Instagram sporting a pair of sneakers they never received. Certainly, digital footprint analysis is a fraud detection and prevention tool that improves accuracy and profits businesses greatly. However, fraud detection tools can stack.

The former will investigate the hardware and software configuration of a shopper’s device, including whether they are using a proxy, their operating system, the type of device, etc. A behavioral investigation will explore what the shopper is doing and when it is being compared to the user’s normal behavior to identify any red flags. A customer’s digital footprint determines whether they are low or high risk, as well as other user data.

On the other hand, a high-risk individual with a suspicious digital footprint may be a fraudster. In this situation, we recommend that additional evidence, such as documentation or a phone call, be used to verify their identity. Customers’ dissatisfaction with this tactic is only created when they were perceived as high-risk. Dynamic friction like this is useful because it changes based on what we know about a user. Since it is based on email or phone number lookup, the digital footprinting process itself is frictionless as it runs under the hood, without the shopper being aware of it. Whether you’re using Shopify or another eCommerce store, digital footprint techniques are becoming a vital component of your business. Even as fraudsters become more sophisticated in how they conceal their identity online, you can still find them by using tools such as phone and email reverse lookup.

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Disclaimer: The opinions expressed in this article are those of the author(s) and do not necessarily reflect the positions of Dexlock.

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