New Study Reports 50% of Chargebacks Go Unanswered


TAMPA BAY, Fla.,  November 18, 2013 (ADOTAS) —Friendly fraud chargebacks, initiated by online shoppers in card-not-present (CNP) transactions, have become an overwhelming enemy of online merchants. online retailers are now incurring a $279 loss for every $100 of fraud loss, the highest amount since 2010 (1).  Despite the pressing financial consequences, a recent study shows that merchants are only responding to 50 percent of chargeback cases, giving consumers free reign to continue friendly fraud activity.  Dispute mitigation company Chargebacks911 says that this behavior not only leaves merchants with a significant monetary loss, but also encourages friendly fraud, a practice which threatens the future of online retailers.

SecureBuy, a leader in global payment fraud prevention and security technology, recently published the SecureBuy Magento 2013 Fraud Report, which stated that nearly 50 percent of all chargeback requests are left unanswered (2). Monica Eaton-Cardone (pictured), co-founder of Chargebacks911, deemed the research findings “unsurprising” and said that inaction by merchants is the driving force behind increasing friendly fraud incidents.

Traditional brick and mortar retailers are quickly being replaced by a fast-growing Internet marketplace, which relies heavily on the use of CNP transactions.  Whether due to ignorance or actual intent to defraud the merchant, consumers are leveraging the loopholes provided through the chargeback process to dispute legitimate transactions.  Unfortunately, many online merchants are living in fear of this activity and rarely fight back against chargebacks, due to the energy, costs and additional resources required, per Eaton-Cardone.  As a result, the consumer is taught that this method of disputing a valid purchase, i.e., friendly fraud (, is a workable and logical solution with no negative outcome.

“The chargeback process largely favors consumers, and many merchants are failing to take even the most basic precautions against chargebacks and friendly fraud,” said Eaton-Cardone.  “But what they must realize is that too many chargebacks could result in fines and a loss of potential business, as well as the inability to continue to accept credit cards.”

Eaton-Cardone stated that retailers can limit friendly fraud by heeding the following advice:

1.    Respond to every chargeback case. Engage in more communication and handle resolutions as quickly as possible.

2.    Require a signature upon delivery of goods. The signature helps relieve merchants of any wrongdoing in the resolution of chargeback disputes.

3.    Keep customer records and account history. This serves to track suspicious customer activity and lowers the risk of accumulating chargebacks.

Eaton-Cardone says that in order to control the growth of friendly fraud, merchants need to abandon their position of fear and defense and instead take a position of offense against chargebacks.  Until the situation is confronted head-on, chargebacks will continue to rise and penalize good merchants.  Although merchants can never completely eliminate the risk of chargebacks, a safeguard is available: A solutions expert can assess the risk, handle costly chargeback disputes, and resolve cases without unfavorable consequences.

“Online retailers must realize that being proactive is a requirement, not an option—it is up to them to protect their businesses and keep them thriving,” said Eaton-Cardone.  “Because consumers often win chargeback cases [due to no response from merchants], merchants have to enact measures that evidence responsible business practices.”

A former online retailer herself, Eaton-Cardone formed Chargebacks911 to relieve merchants of the burden of handling chargebacks.  After her own trial and error in experiences with chargeback issues and seeing a void in the industry, Eaton-Cardone said she wanted to provide fast and reliable services that not only help to recoup the loss of funds as a result of increasing chargebacks, but to also curb future chargebacks so that merchants retain all processing abilities.

Chargebacks911 specializes in servicing merchants and the majority of banking institutions.  For more information about Chargebacks911 and its services, visit

About Chargebacks911

Co-founder Monica Eaton-Cardone established Chargebacks911 in September, 2012, out of necessity after many years as a merchant struggling to find a solution to chargeback issues.  Chargebacks911 was developed specifically for merchants to offer immediate aid through proprietary technology and provide the necessary function that gives merchants the freedom to focus on their core competency and optimize their in-house skill set.  Chargebacks911 specializes in servicing Internet merchants, and offers both response and resolution services for chargebacks and cardholder disputes.  The company works with merchant clients to help them keep their dispute rates down and retain their ability to accept credit cards.  Chargebacks911 provides a unique exception to standard dispute processing for dissatisfied consumers who wish to remedy transactional disputes, without the requirement of additional intermediaries or lengthy correspondence requirements.  For more information, visit

1.   “LexisNexis® True Cost of Fraud(SM) Study.”  LexisNexis, 16 Sept. 2013.  Web.  1 Nov. 2013.

2.   “New Research Shows That Half of CNP Chargeback Requests Go Unanswered.”  Yahoo!, 15 Oct. 2013.  Web.  11 Nov. 2013.


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