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The Question

I am an E-commerce consultant and I also own and operate an on-line business. Recently, a handful of new customers have been placing a string of orders and their transactions were authorized with CVV and 3-D Secure matches. It was by pure coincidence that I was able to spot that multiple orders were being shipped to the same address but to customers with different names. I was puzzled. Why so many orders to different customers from the same address?

The Investigation

I called my Payment Gateway Support Team to discuss it. What we started to notice was that each order was placed with a different credit card. These customers were attempting to use up to 20 different credit cards each! All issued by off shore banks. Upon closer inspection, even though they correctly provided the card number, CVV and 3-D Secure information, they were unable to correctly match the address or postal code with the card.

The Problem

My Payment Gateway and I agree that these are fraudulent transactions. But, what can be done to stop them? The problem is, as I understand it, the credit card holder has to report abuse before a fraud investigation can begin. In the interim, these fraudsters will process as many charges as they can until the card stops working. Those that will get stuck with the bill can range from the card owner (not noticing the fraudulent transactions), the card issuer or the merchant. As for my business, we've blacklisted their addresses. I feel I have been fortunate. If you're a merchant doing heavy volumes of business, are your systems already set-up to intercept this?