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INDIANAPOLIS, IN., June 15, 2004 -- Developing a virtual storefront helped Tons of Toner.com experience unprecedented growth. It also exposed the Indianapolis-based company to significant and sometimes unrecoverable online theft.
Owner David Jones said thieves attempt to defraud his company of more than $12,000 worth of product each month. Some bogus transactions go through undetected, while the other 99% are flagged by anti-theft software or by Jones himself.
“The reason we are able to catch as many fraudulent transactions as we do is because we are on our site, watching where the clients go and what they do. I can identify the customer’s IP address and basically track what city, state or country they are surfing from,” he said.
By tracking site activity, Jones is able to watch for suspicious activity such as orders that originate in one state but request delivery to another.
“I doubt we would catch as much fraud as we do if we weren’t manually looking for it or if our site was fully automated,” he said. “The downside is the amount of time we spend investigating fraud rather than building the business. It’s a huge distraction.”
Online theft costs companies as much as $1.8 billion each year. That cost, the higher credit card interest rates, and the chargeback fees incurred by the retailers, are ones that are inevitably passed on to customers.
Jones is one of many retailers frustrated that so little is being done to prevent online credit card fraud, or to prosecute those who commit it. He said credit card companies he contacts do nothing more than suggest Tons of Toner reject cards and charges that appear suspicious.
“The credit card companies are much more interested in stopping the transaction than catching the thief which seems very short-sighted,” he said. “No one wants to take the time to look into it, it’s just not a priority.”
The plethora of free or complimentary e-mail accounts available through companies like Yahoo and Hotmail make online fraud even easier, Jones said. Thieves establish multiple accounts, place orders from satellite locations such as internet cafés, and have goods shipped to a freight-forwarder, out of country or to another “safe” location.
“These people have absolute anonymity,” said Jones. “They can set up as many e-mail accounts as they like and hit as many retailers as they can. If the fraudulent transaction is detected, the thief simply moves on to the next online business using a different card.”
Jones encourages other online retailers to create a file to track fraud and other suspicious activity. "It will build over time and make it easier for investigators to look for patterns.”
About Tons of Toner.com
Tons of Toner.com is a nationwide supplier of printer, copier, and fax supplies. Founded in 1992, the company offers a full range of new supplies and products for use in over 60,000 different machines. For more information about Tons of Toner.com, visit www.TonsofToner.com. Tons of Toner.com is a service mark of Laser-Grafix, Inc.
David Jones
Tons ofToner.com
9801 Fall Creek Road, # 411
Indianapolis, Indiana 46256
phone 317-915-1000
fax 317-915-1001
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