How to prevent Phone Number Fraud in FraudLabs Pro

Phone Number Fraud Prevention in FraudLabs Pro

Phone numbers play a crucial role in e-commerce transactions as they serve as a key element in establishing trust and facilitating effective communication between businesses and customers. When customers provide their phone numbers during transactions, it allows e-commerce companies to send order confirmations, shipping updates, and tracking information, which enhances the overall customer experience.

Additionally, in cases where there are issues with an order, having a valid phone number enables timely and direct customer support, helping to resolve problems efficiently and build customer loyalty. Furthermore, phone numbers are often used for two-factor authentication, adding an extra layer of security to e-commerce transactions, which is especially important for protecting sensitive financial and personal information.

However, there is also a fraud risk if the phone numbers in e-commerce transactions are exploited by the fraudsters. Fraudsters may use the stolen or fake phone numbers to create fraudulent accounts, place orders and even provide fake customer contact information, making it challenging for businesses to verify the legitimacy of transactions.

Moreover, fraudsters might use phone numbers to carry out phishing attacks, sending text messages or making fraudulent calls to customers, impersonating legitimate businesses to trick individuals into revealing personal or financial information. This can lead to identity theft, unauthorized charges, or other fraudulent activities. Fraudsters can manipulate caller ID information during the order confirmation or customer support process, making it appear as if they are calling from a legitimate e-commerce company to further deceive customers into disclosing sensitive data.

Introduce the new Phone Number Validation Rules

In order to counteract phone number fraud, FraudLabs Pro has introduced new validation rules that empower merchants to inspect and prevent such fraudulent activities. These below validation rules are exclusively applicable to merchants utilizing the Small plan or above. By incorporating these rules, businesses can enhance their defenses against phone number fraud and strengthen the security of their transactions.

  • Phone Number Equal/Not Equal to Valid Phone Number
    This rule is designed to verify whether the transaction was initiated with a legitimate phone number or an invalid one. It serves to ensure the validity of the phone number used in the transaction.
FraudLabs Pro phone number not equal to valid phone number validation rule configuration
  • Phone Number Equal/Not Equal to Billing Country
    This rule is intended to assess whether the transaction was initiated with a phone number originating from the billing country. Its purpose is to verify the geographic alignment of the phone number used in the transaction.
FraudLabs Pro phone number not equal to billing country validation rule configuration
  • Phone Number Equal/Not Equal to Shipping Country
    This rule is designed to evaluate whether the transaction involves a phone number from the shipping country or not. Its objective is to confirm the alignment of the phone number with the shipping country in the transaction.
FraudLabs Pro phone number not equal to shipping country validation rule configuration

Configure the Validation Rule

The following steps outline how to activate the Phone Number Checking feature. These instructions will guide you on enabling this functionality.

  1. Login to the FraudLabs Pro merchant area and click on the Rules menu.
  2. On the Rules page, click on the “Add Rule” button.
  3. On the Rule dropdown, select “Phone Number Not Equal to Valid Phone Number”.
  4. Select the Action and then click on the “Save” button.
  5. Done.

The setting described above demonstrates the process of flagging an order for REVIEW when an invalid phone number is detected. The operation of this check is straightforward, it examines whether the order was made using an invalid phone number. If it identifies an invalid phone number, the rule is triggered and the FraudLabs Pro status is adjusted according to the configured action (Manual Review, Approve, or Reject). If the number is valid, the rule remains inactive.

In conclusion, merchants have to be aware of phone number fraud as the misuse of phone numbers by fraudsters poses a significant threat to the security and trustworthiness of e-commerce transactions. In the most extreme scenario, it could potentially harm the reputation of the business and alienate valuable customers.

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