How to Protect Your Dating Business From Fraud
Consumers are getting more reliant on technology than ever and are gladly using dating apps. When you mix it with the growing number of financial scams, the risk is real. Can a reliable online dating merchant account help you protect your dating business?
The Nilson Report states that $24.26 billion were lost last year due to payment card fraud worldwide, and it’s predicted that this number will grow by almost $10 billion over the next 3 years.
As dating websites engage millions of users, they’re becoming one of the markets into which criminals move aggressively. And the thing is that the faster new technologies develop, the more likely they are to become the target of fraudsters.
Romance scams are growing
A romance scam is one of the most common fraudulent activities in the online dating environment. It happens when someone creates a fake identity and starts a relationship with a victim with the intent to steal their sensitive data.
According to Scam Tracker there were 44,434 scam reports across the USA and Canada last year (from June 11, 2018 to June 11, 2019). That is 2,952 more scam reports than were submitted the year before. During this period there were 326 romance scams and the largest amount lost was $300,000,000, so the scale is large.
Moreover, love seekers in the UK lost £41 million due to romance fraud in 2017.
The dating businesses usually observes several behavioral patterns that come with suspicious accounts. The scenario is pretty much the same every time — it starts from an innocent chat, but fraudsters usually want to quickly take the conversation outside the dating website. They also make as many connections and spam as many people as possible.
Cybercriminals always target a specific group of people and know how to touch their emotions to get what they want. This means that they pretend to be their target’s love interest. It starts with creating a fake profile and progresses to luring the victim and making them fall in love.
Common sense is not enough
The real problem begins when daters start interacting with fake profiles. It needs to be spotted as quickly as possible before anything bad happens, especially when users don’t know how to recognize the red flags.
Of course, you can’t protect everyone from sharing their money with people they know nothing about. You can count on users’ common sense or ability to verify people they flirt with through social media etc. But common sense cannot be enough when emotions are involved and there’s a great manipulator on the other side of the screen.
Keep fraudsters at bay
Cybercriminals never sleep and the data show that they’re succeeding. So the challenge is to fight fraud before it happens. What you can do is dump fake dating profiles and take care of real users safety.
What can help is having an online dating merchant account provided by a payment platform with the team to detect fraud, track, and understand how it impacts your customers. The solution here is to monitor new accounts to spot fake online dating profiles and suspicious behavior as well as to understand the probability of fraud.
There are proven steps you can take to reduce fraud on your dating site as there are some patterns of suspicious behavior, such as immediate changes to the account details, including location, age, or photos. Criminals send many more messages and make more connections than random users, and spend more than genuine customers.
Also keep in mind that fake accounts are often created from suspicious IPs, criminals make purchases with stolen credit cards, and usually pay for everything on offer in a short time span. None of these behaviors are typical for real customers.
Pay attention to scripts or bots that cybercriminals use to sign into accounts with stolen credentials. You can also use an algorithm that detects dating scams by analyzing dating profiles.
Safeguarding sensitive information
One of the most important things for dating services is establishing trust in customers. Even the most user-friendly experience won’t help if people don’t feel safe enough while using the site or app.
It’s especially crucial for dating websites where people share much of their personal data. Think about the way users interact on your site and how many personal data they leave — they need to trust your website before they start using it.
This is why you need an online dating merchant account with anti-fraud systems with well-optimized fraud rules that will help you prevent various types of abuse. Bearing this in mind, choose solutions that detect fraud attempts, so you’re notified about any suspicious activity as soon as it occurs.
You can find third-party systems or choose a payment platform with dating merchant account that will provide you with top-level security and additional layers of tools based on machine learning.
However, you should be aware of overly strict fraud filters to avoid situations when genuine accounts and transactions are labeled as suspicious. We also highly recommend using a non-invasive 3D Secure authentication that decreases the number of chargebacks.
Speaking of chargebacks, this is what the dating industry also struggles with along with fake accounts and profile takeover issues. Any fraud attempt can result in chargebacks and threats to your business, so you need to address chargebacks, specifically once they come as a fraud.
Remember that people don’t have the best password hygiene. They tend to use the same password across different services, so if there’s a data breach (even somewhere else), their accounts on your dating service can be at risk.
Overall keep in mind that fraudsters are becoming more sophisticated with their attacks, so you may need to tweak your fraud solutions that may be outdated. The goal is not letting customers see that there was a fraud attempt on their account, so you always need to stay ahead of fraudsters. Prevention is better than cure.
Let’s summarize what you can do to prevent your dating business from fraudsters:
All that cybercriminals do directly affects your business and attacks your bottom line, so you need to overcome the friction to understand the probability of fraud. At its core, it’s about people’s emotions.
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