Sometimes the biggest threats come from the foes who pose as friends, spinning tales that seem legitimate and often urgent. And then comes the realization:
You’ve been scammed.
Eric Kraus, V.P. and general manager of Fraud, Risk and Compliance Solutions at FIS, told PYMNTS that friendly fraud looms as a growing threat for merchants and banks alike.
Friendly fraud is another name for first party chargeback fraud, which occurs when a consumer buys something online through a card-based purchase, and then disputes the charges or requests a chargeback, having already received the item or the service that they bought. The conversation was held against the backdrop where merchants of all sizes say “friendly fraud” is the No. 1 fraud trend they are dealing with, representing a significant increase in loss exposure the past few years.