What is Friendly Fraud and How Does it Differ from Traditional Fraud?

Is chargeback fraud the same as friendly fraud? In this blog post, we will discuss the definition of chargeback fraud and friendly fraud and explain the similarities and differences between the two.

We will also provide tips for how business owners can protect themselves from chargeback fraud and friendly fraud. This is a question that many business owners have, and it can be difficult to determine whether or not the chargeback you’re dealing with is fraudulent.

There is a lot of confusion about what it is and how it works when it comes to chargeback fraud. Some people refer to it as “friendly fraud,” while others call it something completely different. So, what is chargeback fraud? And more importantly, how do you know if you’re experiencing friendly fraud or actual fraud?

When most people think of chargeback fraud, they think of criminals who use stolen credit cards to buy items and then request a chargeback from the credit card company. This type of fraud is often called criminal chargeback fraud. However, there is another type of chargeback fraud that is becoming increasingly common- friendly fraud.

How is it different?

-Friendly fraud is when someone makes a purchase and then requests a chargeback from their

bank after receiving the product.

-This is different than actually being scammed, in which you never receive the product that you ordered.

-Friendly fraud can be difficult to detect because it often looks legitimate on paper. For example, the buyer may claim that they never received the product, even though it was delivered.

-There are a few telltale signs of friendly fraud, such as ordering high-value items and then requesting a chargeback soon after or asking for a refund long after receiving the product.

-However, since friendly fraud can be difficult to detect, it’s important to be aware of the signs and take measures to protect yourself from it.

How is friendly fraud perpetrated?

-There are a few ways that people perpetrate friendly fraud.

-One way is by buying items with a stolen credit card number. The buyer will then request a chargeback after receiving the product, claiming that they never made the purchase.

-Another way is by ordering items and then returning them to the store after receiving them. This is known as “return fraud.”

-Finally, some people will order items with the intent of requesting a chargeback but will not actually receive the product. This is called “chargeback fraud.”

What can you do to protect yourself from friendly fraud?

-There are a few things that you can do to protect yourself from friendly fraud.

-First, be aware of the signs of friendly fraud and watch out for them.

-Second, make sure that you have strong anti-fraud measures in place. This can include fraud detection tools and measures to prevent chargebacks.

-Third, be sure to communicate with your customers about their purchase and the terms of return. This will help to ensure that they are aware of the policies before making a purchase.

-Finally, keep track of your order history and watch for any suspicious activity.


Chargeback fraud, specifically friendly fraud, can be difficult to distinguish from regular consumer disputes. However, there are some key factors that can help businesses identify when a chargeback is fraudulent. The best way to combat friendly fraud is to develop a comprehensive strategy that includes preventative measures and a dispute resolution process.

Duane Roberts

Duane Roberts

Paul Roberts: As a legal affairs journalist turned blogger, Paul's posts offer expert analysis of legal news and court cases. His clear explanations and engaging style make complex legal issues more understandable for readers.

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