Gartner Survey: Retail Internet Fraud Is Twelve Times Higher Than Offline Fraud.E-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. on retail Web sites is the wave of the future. However, fraud on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the is taking its toll on electronic retailers (e-tailers), who are getting hit not only by Internet fraud A crime in which the perpetrator develops a scheme using one or more elements of the Internet to deprive a person of property or any interest, estate, or right by a false representation of a matter of fact, whether by providing misleading information or by concealment of , but also by the credit card companies. A new Gartner survey of more than 160 companies reveals that 12 times more fraud exists on Internet transactions and that e-tailers are paying credit card discount rates that are 66 percent higher than traditional retailer fees. Moreover, Web merchants bear the liability and costs in cases of fraud, while credit card companies generally absorb the fraud for traditional retailers (as long as the retailer follows procedures and saves a physical signature on a credit card transaction receipt). Surveyed e-tailers reported that their average credit card discount rate was 2.5 percent plus about 30 cents a transaction. The same average for traditional retailers is about 1.5 percent plus 30 cents a transaction. Therefore, a merchant may pay credit card processors $2.80 for selling a shirt online, but pay only $1.80 for the same transaction in the physical store. Another kicker Kicker A right, warrant, or some other feature added to a debt instrument to make it more desirable to potential investors. Notes: The ability to trade a bond or other debt instrument in for stock may entice investors, if they feel the stock will appreciate. , according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the Gartner survey, is that e-tailers spend about four times more to resolve and process chargebacks than retailers do. The bottom line is that e-tailers are getting hit from all sides. They suffer from fraud that is 12 times higher than it is in the physical world; they incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. the costs of all disputes and fraud resulting from Internet sales; and they pay discount rates to the credit card companies that are 66 percent higher than physical world fees. Furthermore, e-tailers must pay for Internet payment gateways and fraud detection, which can add another 50 cents to each transaction. Meanwhile, credit card companies have failed to offer e-tailers a cost-effective solution for fraud prevention. |
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