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With additional help coming from merchants in tracking fraud related to particular postal and Internet addresses, the IFCC--co-managed by the FBI and the National White Collar Crime Center--has recovered $17 million in an online ordering scam.
Federal authorities, with help from online merchants and others directly involved in e-commerce, have recovered about 10% of $176 million in losses related to an international scam involving online retail orders under Operation E-Con, according to the Internet Fraud Complaint Center, which is co-managed by the Federal Bureau of Investigation and the National White Collar Crime Center.
Operation E-Con, the results of which the Internet Fraud Complaint Center announced last month, covered more than 90 investigations that led to 73 search-and-seizure warrants and $17 million in recovered goods. The fraud typically occurred when bogus online orders were placed at U.S.-based retail web sites from overseas and shipped to legitimate addresses in the U.S., then forwarded to a foreign address.
Julie Fergerson, chair of the Merchants Risk Council (formerly known as the Merchant Fraud Squad), says the scam typically begins with a foreign online order activated with a fraudulent credit card transaction, but shipped to a U.S. address in an effort to make the transaction less noticeable to merchants and card issuers as a suspicious transaction. The Merchants Risk Council, which includes about 3,000 online merchants among its membership, is stepping up its participation in fighting such scams by helping authorities identify Internet addresses, postal addresses and other information associated with suspicious online activity.
Fergerson, who is also a co-founder of Clear Commerce Corp., a provider of online security technology and services, says the Merchants Risk Council plans to step up efforts this year in helping merchants learn how to better monitor and report suspicious online buying activity to law enforcement officials. "We have to help authorities build a case against the criminals," she says.