Retailers are consistently vulnerable to fraud and theft which can be crippling for establishments of all sizes. Chargeback fraud contributes greatly to the losses businesses incur over the course of their lifetime and are rapidly becoming more problematic. In fact, according to a study by LexisNexis, overall retail frauds have tripled since 2017. 

The rise in online shopping trends has also ushered in new sets of malicious threats for retailers. That said, the key to staying ahead of chargeback lies in an extensive understanding of why they occur and how you can prevent them. Here’s what you need to know:

As somebody who works for a financial institution, AML compliance needs to be one of your top priorities. One of the main AML compliance regulations states that every financial service company must perform identity verification. This is why it’s especially important to make sure that your customers really are who they say they are, also known as customer due diligence (CDD).

That said, it’s crucial that you closely follow a CDD checklist to avoid fines, criminal negligence, or even a company shut down. Making sure your business is fully compliant with AML regulations is key to protecting both your company and your customers. 

This checklist will help to ensure your customer due diligence is completely taken care of:

While the evolution of technology has been beneficial to financial institutions and their customers alike, it has also made it easier for the fraudsters to get around unsophisticated security measures.

A fraud committed online is usually known as virtual fraud. The only way to reduce the virtual fraud risks is by understanding what it is and what preventive measures you can take.

CEO Bryan Lewis With WCMY Morning Mix’s Maggie Frost On Preventing Identity Theft

WCMY Radio

Chargeback fees can cause serious financial damage and also threaten your business’s reputation. Chargebacks do not only refer to returned merchandise or lost sales; the true cost of chargebacks lie in fees that are tied to them.

Typical chargeback fees range from $20 to $100. Add in the customer acquisition and operation costs (stocking, storing, packing, and shipping) and your business ends up losing almost three times the transaction amount.

Therefore, it is crucial for you, as a merchant, to take preventive measures to reduce the instances of chargebacks fees. Here’s how you can stay ahead:

The Bank Secrecy Act (BSA), requires all financial institutions to collaborate with the US government to combat monetary crimes as well as the prevention of money laundering. Under BSA requirements, financial organizations must work relentlessly to detect and identify potential suspicious financial activities. Since its initial inception, BSA regulations have undergone several amendments, including the Patriot Act, which helps expand BSA’s scope to include monitoring and preventing terrorist financing activities. 

Failing to be compliant with all changes to BSA regulations can result in hefty fines or even jail time. That’s why it is so critical to stay on top of changes in the industry, but many financial professionals don’t know how to do this, as they are busy with their day jobs and duties. 

To make sure you are getting the most accurate information in a timely manner, here are a few simple and painless ways to keep up with BSA requirements and changes when they happen:

KYC (or Know Your Customer) is a practice in all regulated banks for customers’ identity verification. It is a necessary measure to monitor and assess customer risk. In fact, KYC authentication is a legal requirement for financial institutions as an anti-money laundering (AML) compliance measure.

KYC authentication is a process carried out by organizations to verify the identity of their business partners and clients to stay compliant with current laws and regulations. Failure to stay on top of the KYC process can lead to significant fines for your company. Therefore, you must remain vigilant and up-to-date on your KYC process in order to stay AML compliant.

Although there are many common mistakes every company makes in regards to AML compliance, you should avoid three critical KYC authentication mistakes at all costs.

A lot of businesses have questions about credit card chargeback merchant rights. To answer that, you must first understand what a chargeback is and how it works.

In simple terms, a chargeback is a reversal of any credit card payment initiated by the bank that issued the card. This is often used when a buyer feels that the product description is deceitful or they suspect identity fraud, they will contact their bank directly to enforce a chargeback.

A chargeback is a safety net designed for cardholder’s security. Therefore, you should understand credit card chargeback merchant rights to ensure you protect your business from chargeback frauds whenever possible.