Jewelry is one of the most vulnerable sectors for online fraud, says a new report from Signifyd, an e-commerce fraud-prevention platform.
The report, which measures how often e-tailers are victimized by scams involving stolen credit cards and taken-over accounts, says the fraud rate has risen for “jewelry and metals,” even if it has fallen for most other categories.
After analyzing data from 5,000 merchants in different sectors, the company’s Global Fraud Index found that the fraud rate for jewelry rose in the first quarter of the year, from 11.72 percent to 13.27 percent. The overall online fraud rate came in at 3.59 percent, down from 5.51 percent the year before.
This is partly due to the high value and fungible nature of jewelry, says Sourabh Kothari, Signifyd’s director of merchant advocacy.
“When you are talking about international syndicates or larger syndicates, jewelry has universal appeal,” says Kothari. “With the other industries we are tracking, like auto parts, if you steal something, it might not be popular everywhere. When you steal jewelry, you can sell it anywhere.”
Another problem: Jewelry e-tailers are traditionally guarded about their data, making information sharing difficult.
He added that jewelry sites tend to overrely on traditional fraud-fighting tools like blacklisting, as opposed to newer methods that use machine learning. The older “static rules” sometimes cause e-tailers to miss possible sales, Kothari says.
Jewelers that sell online should start to use behavior data to detect fraud, he adds.
“If someone is spending less than 2.5 minutes on your site, you might want to call them before you ship,” says Kothari. “It’s pretty logical: Why would someone make a decision to buy diamond jewelry after 2.5 minutes?”
(Image from Pixabay)