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5 Ways To Fight Fraudulent Customers

The customer isn’t always right. In fact, some customers are liars and they’re very good at it. These lies can be used to get money out of you illegally. As a result, it’s important to put in place some security measures to protect you from these fraudulent customers. Here are just five ways to protect yourself.    

Consider a screening process for clients

Some customers will try to use a fake identity for their own means. Putting in screening measures can help to ensure that you don’t take on a client who is illegally pretending to be someone else.

Obviously, you’re not going to do this in all industries – screening customers in a coffee bar might be a little excessive and won’t achieve anything. However, when it comes to selling large value items to people online, you may want to do an identity check. Merchant programmes such as Verified by Visa can be worth putting in place on your site to check that someone isn’t using a stolen card. Credit checks can also be useful for checking that someone isn’t lying about their financial details – tools like Experian can be used to run credit checks on customers.

Meanwhile, there could be times when you want to ask for someone’s ID in person. This is a legal requirement with age-restricted goods and services. ID could also be necessary if someone is trying to gain access to funds or information that is usually password protected – if they are unwilling to show you ID, they could be a fraud.

Passwords themselves can be useful screening tool for returning customers. These are often needed for online accounts and subscriptions. Some companies are even now using advanced security measures such as facial recognition, which are harder to hack than a password.

Monitor and track delivered goods

Online deliveries have become a major source of customer fraud. Some customers will claim that they did not receive a parcel when they actually did so that they can then claim a refund. Whilst some customers will take up this issue directly with you, others will go through their credit company – this act of fraudulent refunding is commonly known as chargeback fraud.

To prevent this kind of fraud, you’re best always tracking deliveries. By using a trusted courier service, you can ensure that records are kept every time a parcel is delivered. You could also ensure that a signature is required by the recipient. Confirmation emails can also be used to give evidence that a product was dispatched.

Put agreements in writing

Contracts and receipts are important not just to establish trust with your customers but to protect you against customer fraud. If a customer claims that they never paid for an item, you can use a receipt as proof. If a customer claims that you agreed to something that you didn’t agree to, you can use a written contract as proof of the agreement.

There are other ways of putting agreements into writing in order to legally protect yourself. When it comes to phone conversations or in-person meetings, you may want to send a follow-up email to summarise any agreements that took place. Recording audio can also give you evidence to rely on – many companies record phone calls with customers (with their permission). You can also use transcription services such as Take Note to convert recordings into text. This could help to put information into written format that could make it easier to reference when trying to argue your case.


Placing CCTV cameras in your premises could also help to protect you against customer fraud by giving you video evidence. This could help in numerous cases of fraud.

Firstly, it could help to give evidence against false injury claims. A common strategy used by fraudulent customers is pretending to injure oneself by falling on a wet floor. By having CCTV footage, you may be able to tell when a customer has simply pretended to fall.

CCTV could also help to catch cases of credit and debit card fraud. If someone claims that their card has been used by someone else in your premises, CCTV may be able to be used to check the transaction to see who was using the card.

You can buy security cameras using companies such as Swann. It’s also possible to hire security cameras through companies – however in these cases you do not have ownership over the footage.

Hire legal help

When dealing with any case of fraud, it’s worth talking to a legal advisor who can help you to find the best way to proceed. Some fraudsters can be very cunning – a legal advisor will know the best way of dealing with the situation so that they don’t take further advantage of you.

Legal professionals could also help to write contracts and could advise you on how to implement a screening process that keeps you protected. All in all, having a solicitor on call can be very handy when keeping your company secure. Some solicitors specialise in supporting businesses against fraudulent customers – these could be the best legal professionals to use in such a situation.

About the author, Mark

Mark Asquith is a serial entrepreneur who has built globally successful design, marketing, software and digital businesses since he quit his real job in 2005.

A passionate podcaster, global keynote speaker and helpful bloke, Mark is the co-founder of Podcast Websites and the creator of Excellence Expected. He has a terribly embarrassing beard.

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