Credit Card Fraud with Domain Purchases

[rectified]

What you charge for domains would never cover a chargeback fee.

but if you have enough security systems in place then a fraudster would not get to the point of completing any order in the first place.

I don't intend to cover chargeback fees from a single domain, chargback/refunds related to domains are usually less then 1% and again we do get payments refunded for most of the TLD if we cancel them within 2-3 days, so considering all these factors it does covers the cost for us.

We don't intend to make money by selling domains, we just sell domains so that hosting customers can get everything they need from one place.


MOD NOTE: Edited for content.

 

[rectified]

What you charge for domains would never cover a chargeback fee.

but if you have enough security systems in place then a fraudster would not get to the point of completing any order in the first place.

Also regarding security we do use MAXMIND for help with fraud checks, but we don't let it block any order, we let all orders pass through, then we manually verify order and details provided by maxmind just help us with fraud verification.

But we don't rely any automated security system, to let go any genuine orders/clients

 

[HostNIT]

What has been preventing me from becoming a domain reseller is the question of what happens when somebody purchases a domain with a stolen credit card? Sometimes this doesn't get found out for a couple of months. The bank then does a chargeback but there doesn't seem to be a way for the merchant to get a refund on the domain purchase.

Do you guys have to deal with that at times?

The best way to deal with this situation is prevention. Any other means would simply equate a loss.

I would spend some time and money investing in a good fraud prevention method.

 

[easyhostmedia]

The best way to deal with this situation is prevention. Any other means would simply equate a loss.

I would spend some time and money investing in a good fraud prevention method.

also depends on what domain seller system you use.

we use resellerclub, this happened to me once.

1) lock the domain (this stops them from moving the domain), you can do this from day 1 with any domain purchase even though they cannot move a domain for the first 60 days anyway.

2) suspend the purchases account (this stops them from logging in.)

3) change the domains nameservers. (this will stop their site from working).

4) Push the domain internally to your account and change the registrant detail to yours.

you can legally do this as you as a host have purchased and registered the domain, but your client used illegal means to pay you, so the domain is actually yours and not theirs