Large number of credit card fraud purchases on website

[thebluedot]

I have contacted my PayPal account manager extensively on how to prevent fraud on our website. We have our fraud filters through PayPal all the way to the max - and somehow - it is like these filters do not exist for people using unauthorized credit cards. We require the billing address and shipping address to be the same, AVS must be available, we deny suspected forwarding adresses, and have every other fraud filter in our account set to deny. We turn away so many legitimate sales because of these filters, yet the people comitting fraud seem to know exactly what to do in order to breeze through our filters. 

I have contacted Mastercard, Visa, American Express as well as Discover and each company has told me I must contact my credit card processor - PayPal directly regarding the manor. PayPal tells me there is nothing more they can do on their end - yet they gladly remove the funds from our account when they tell us to ship an item when it is unauthorized. These unauthorized payments sometimes do not come through for weeks or even months later and our account manager is telling us that we have to take action on our end to prevent fraud from occurring!

How do we take action on this? How is this not PayPal's responsiblity to prevent authorizations like these from coming through to our website. The number of credit card chargebacks we receive has come close to 1% - yet PayPal tells us their threshold is 0.5%. 

Honestly - I have exhausted resources on our end and we continue to have Cases that we are required to respond to in the resolution center. We must provide tracking information for each case - even though tracking information is automatically uploaded into PayPal with each sale. If these cases are not responded to within 7 days - PayPal removes the funds permanently from our account. When we do provide the tracking info - PayPal holds the funds for 45 - 90 days at a time. 

I am completely lost for answers at this point. What other steps are we to take to prevent these fraudulent transactions from coming through to us? I thought this was the job of our payment processor and are charged such exhuberant rates to use PayPal as a service. 

What steps are others using to prevent fraud from coming through and what can be done to prevent repetitive offenders from visiting our site? 

Any help here would be much appreciated!

[mikeMann]

If the billing and shipping addresses are different on an order, we email  the customer to tell them we can only ship to the billing address or to their job.  If they do not respond within a weeks' time, we cancel and refund the order.  Our chargebacks have gone way down since then.  We still lose perfectly good orders sometimes.  We also try calling the customer to ask them to verify that they placed the order. 

We also give them the option to email or fax a copy of their credit card front and back to help verify its their credit card.  (No one has done this one yet)

Or, we will cancel and refund the order and have them replace the order as a paypal transaction- not credit card.

Have a question on fraud filters.  We just started using Paypal as our payment gateway.

I'm not sure what fraud filters to use. We started with the fraud filters set so high that every order was red-flagged.  We set them lower, but we're not sure what the optimal settings for fraud filters are.   Any help on this would be appreciated.  Thank you!