The frustrating thing about fraud

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The frustrating thing about fraud

Think about the last time you had a suspected fraudulent booking and then try and work out how long your organisation spent trying to deal with it? If your organisation is well versed in dealing with fraudulent bookings then you should be very cost efficient in dealing with such bookings. The worrying thing is many organisations are not, is this their fault?

I will avoid answering the question but what it comes down to is the obvious costs of fraud prevention against the hidden costs. Lets take the example of a booking say for the value of 800 pounds, if we work on a 10% profit margin then you have a 80 pound profit. In making a risk assessment, the issue is does 80 pound profit outweigh a 800 pound chargeback?

The costs incurred are likely to be a few pounds per transaction for any fraud prevention system in place, plus the cost of the member of staff who is dealing with the matter but what about all the additional staff that get involved? If fraud at your organisation is more of a weekly rather than daily occurrence the chance of a fraud booking is quite exciting and draws in many other employees giving their two pennies worth. It is important that an organisation learns from fraud but at what cost?

If a booking draws more attention in employee costs that the actual threat of the chargeback surely it is worth not checking the booking in the first place? I certainly would not advise this but we need to take the excitement out of a fraudulent booking to ensure organisations can deal with the booking in the most efficient way.

The next time you have a fraudulent booking at your organisation see how many people descend on your desk wanting to know what is going on.

Happy fraud prevention!

David