Quote:
Originally Posted by Barry-xlovecam
the fraud battle never ends. You can only work on fraud prevention -- after the fact you are always butt-hurt -- you lost
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Yes I agree prevention is the only effective solution. We do reverse a few chargebacks thanks to the 3D secure that is optional (so no customer friction), but it does just a little.
Automated prevention has limits, fraud guys with nice IP addresses, emails and cards will make the transaction whatever AI systems and db's you employ. Also we got some 3d secure yet traud transactions (phishing forms also ask the 3d secure pass...) and I feel a little bad in reversing legitimate chargeback just because fraudster stole the 3d secure pass and I can reverse.
So the real prevention it is: human staff of yours to refund the suspicious transactions as soon as happened. We refund a lot of suspicious stuff and the few times we don't do because we're not sure, we get chargeback, in fact if a transaction it looks suspicious, it most likely is bad.
In case of cams, this is worst than with prerecorded content paysites - such refunds (and card blacklist) must happen before that the cash was spent with some girl. In fact, it does not look nice to chargeback the girls, is not the girl's fault if she shown to a fake money guy, the girls expect the site to be in charge of that. In fact, we have a chargeback insurance/protection of up to $250 per girl per 15 days period (which translates to $500 chargebacked, at 50% we pay to the girls).
So for a cam site, except the $25 per chargeback transaction, and the fear of hit 1%, there's also either 50% of the spent money you should pay at your loss to the girls, or, passing the chargeback to the girls which make you lose girls. Now, I remember we have NOT chargebacked any girl in the past 12+ months as none reached the $250 limit, and that happens the most years, no chargebacks.
So as a matter of curiosity I just went to check our chargeback ratios.
The 1% limit is $10k chargebacked every $1M sales.
I just checked our VXSbill reports. For last $1,038,505.00 of sales, we got $690.95 chargebacked.
This is $665.33 per $1M, or 0.06%. We can chargeback 15 times more, before to hit 1%.
I believe 0.06% (per $million) is record low CB ratio; and it always been low in past years - except a few times when we got a $4k chargeback and a $6k chargeback, at once, both quite special cases.
But 0.06% it is not just us being cool at spot frauds and refund quick. At least half of the transactions is whale we have in site since years, so safe. And regarding new guys, most of our chargebacks (or more exactly, transactions we refund quick to avoid chargebacks) come from affiliate traffic - not from our own traffic sources. Either plain frauds of affiliates trying to get the $80 PPS, or simply they send traffic that contains an high % of fraudsters, I even told some affiliates to removing links, and they had in legit tgp's or toplists next to other cam platforms, but for us it was not worth as 1 every 3 signups was fraudster, all different guys, perhaps that's the wild wide open internet?
I am pretty sure that if we had as much and varied traffic as a chaturbate or myfreecams, we would have way higher chargeback ratio whatever the 6th sense of risk department. CC's are a "technology" from 50 years ago, plastic cards. They wanted to be used on internet but it's absolutely not suited, see "CARD NOT PRESENT" chargeback reasons. This includes "friendly fraud" which is not friend at all, i.e. a guy spends then say it was not him, need to use guess and pick who to trust, that's from middle ages, before technology existed. In fact internet banking uses 2 factor authentication, with one time PIN generator hardwares, or one time passes sent to CELL each login and such. Some 3d secure is already one time pass, but most use a static pass that can be phished.
Even my cell Samsung phone you can't unlock with a pass, but with my finger only, yet is normal that guys can spend thousands dollars then say it was not them (or - it was not them really, and it was a mexican or vietnamese kid).
Ending note: bitcoin transactions it can't be chargebacked. We support bitcoin sales since years, and we get nearly no sales in bitcoin. You know what? If there was a Visa/MC system in place that can't be chargebacked or faked, perhaps people would not use it exactly because of that
