Water Filter Credit Card Fraud Scam Alert

Have you ever searched google to find out about a scam alert?

This is one of those articles and I would have never thought I would have to write about it in the water filter industry.

This scam can affect any online store, so I want to share our experience with you.

We were recently affected by a water filter credit card fraud scam and we want to get the word out about it because you, the customer can be affected as well.

How this credit card water filter scam works

Before I tell you exactly how you are affected by these types of scams, let me lay out the scam in detail so you can see it before it happens.

As a person who owns a water filter, you have really one main responsibility each year, that is to replace your cartridges. That is the only way to ensure your water stays safe.

During the year, you might see deals for your water filter cartridges on the internet, like eBay. This particular scam happened on eBay.

A number of our customers saw incredibly cheap cartridges on eBay and one of our customers, in particular, wanted to check if this was legit. So he bought the cartridge for his water filter through this eBay seller.

The eBay seller was a scammer that listed incredibly cheap water filter cartridges on his eBay store.

He listed products on his eBay store that he knew he could buy on online stores.

When a customer buys one of the products he lists, he takes the customers money on eBay into his Paypal account, then with a stolen credit card he purchases the cartridges from MyWaterFilter.com.au (he doesn't care about the price because he is using someone else's money). The scammer gets to keep the customer's money in his eBay account.

This eBay seller, puts the customer's name, address and contact details into the order he has with us and we send the customer the water filter cartridges that he purchased on eBay. Sneaky!

It is very sneaky!

The reason why it is sneaky is because to the customer, it looks like they are getting a good deal and the customer won't realise that a stolen credit card is being used by the scammer to pay for their water filter cartridge. They will receive the order just like any other order they do on eBay.

Everyone but the scammer gets affected!

What happens next is the part of the story where everyone but the scammer gets affected, including you, the customer.

First of all, the person who owns the stolen credit card will report the fraudulent credit card charge. That sucks for that person because who likes time out of their day to deal with money that was stolen from them.

Sure, potentially they lost their wallet or had their credit card details remembered by someone but its more likely that we are dealing with a professional credit card scammer, and the card numbers were swiped from an ATM or stolen from a database and the person wasn't at fault.

So what happens next.

The retailer gets notified of a "credit card chargeback" from the bank. The bank issues a chargeback from the company who received the stolen money from the stolen credit card. In this case, that is MyWaterFilter.com.au.

Straight up, we get hit with a $25 AUD chargeback fee. In the case of fraud, the retailer accepts the chargeback and the stolen money gets returned to its rightful owner.

The problem with this is, we had already sent the product to the customer before we got hit with the chargeback. We thought it was an order for one of our regular customers.

So we were hit with a $25 chargeback fee and the cost of the product and shipping (we offer free shipping) with no money to pay for these costs. This is not good for us, our customers or the industry.

Once we realise it is a scam, we call you!

This is where you get involved.

In the most recent cases, we contacted the customer and let him know what happened.

Our customer didn't realise that it was a scam and that is normal. No one does. They were just trying to save some money for their family. Our only suggestion is if you think its too good to be true, it probably is.

Of all the people who we got in touch with, they said thank you for contacting them and letting them know. No one wants to do the wrong thing.

They helped us to do everything we could to shut down the scammers and we thanked them for that by giving them a good deal on the cartridge they unknowingly bought through a scammer.

Once we became savvy of scam orders, we stopped sending those orders which means if you order from a scammer, you won't receive the order and you will be trying to chase down the scammer on eBay which is even more headaches.

The time, energy and hassle is not worth it

The time and energy to go through this is more than what the customer wanted to do though. He just wanted to get his cartridges for his water filter.

In the end, we recommend buying through a retailer that you know and trust.

There is a significant cost to everyone involved when a scammer gets his way. Everyone loses, from the customer, to the owner of the stolen card, the bank, the credit card processor, the platforms like eBay and us, the retailer.

If you do see a great deal somewhere but you want to buy from us, get in touch with us and we can help find out if its a scammer. If it's not and we can't match the price, go for it, save some money.

What about Fraud Protection?

After this incident, we investigated what options we have as a retailer. The reason why is because even though we are the least responsible for the situation, we lose the most.

The customer doesn't lose out, the owner of the credit card doesn't lose, the banks and credit cards don't lose, but the retailer loses the product and the chargeback fee.

So what can we do?

In Australia today, there is over 476 million dollars lost by retailers in online payment fraud scams. This is not good long term because it is a cost to the companies that serve you.

The sad thing for retailers is that the major Australian banks don't have basic fraud checks in place like AVS (Postcode) and CVV (3 digits on the back). Over 90% of banks don't check these when we submit them.

If they had AVS checking, that would solve much of the fraud problems because most of the time, the postcode of the stolen credit card would be different to the postcode of the person being sent the product.

Unfortunately we are not that advanced yet in Australia.

We can't rely on the banks. What you can do.

Clean contaminant-free water is our service and with your help we can keep costs low and give you great service. We ask you to support your water filter retailers.

Credit card fraud is a huge problem, across the entire retail sector. All we can really suggest is, if you think something is too good to be true, let us know and we will investigate it for you.