Online fraud typically spikes when holiday shopping begins in November, but so-called friendly fraud poses another big threat this year with the pandemic pushing more consumers — and inexperienced merchants — to online sales channels.

Friendly fraud occurs when a consumer demands the reversal of a purchase they made online but don’t recognize, triggering chargebacks with merchandise losses and time-consuming negotiations between banks and merchants.

With coronavirus driving a mass migration to online shopping, friendly fraud is already suspected to be higher than last year. Boise, Idaho-based payments fraud-monitoring company Kount is responding with unprecedented steps on the eve of the fourth-quarter shopping frenzy.

Kount last month hired longtime fraud-prevention consultant Scott Adams as the company’s first-ever vice president of friendly fraud, and the firm also unveiled a new partnership with Verifi, Visa’s dispute-resolution service, to help block excess chargebacks in near-real time.

“This year consumers are buying a lot more items online through unfamiliar channels and many times they don’t recognize these charges, triggering lots of chargebacks,” Adams said. Adams co-founded FraudPVP, which supplies fraud management tools to Visa.

In addition to rising friendly fraud…..

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