Fraud & the Chargeback Cycle

Business loss is a given.   The moment you open your doors, you are going to face either theft, misplaced / mis-shiped & damaged items and worst of all, fraud.

As an online business, physical theft (“shrinkage”) is unlikely.  However, we run a higher risk of fraud than retail stores.  We regularly get a ton of scammy b2b e-mails, but consumer fraud (identity theft in particular) is what we’ll discuss here.

Chargebacks

What is a chargeback?

A chargeback is the return of funds to a consumer, forcibly initiated by the consumer’s issuing bank. Specifically, it is the reversal of a prior outbound transfer of funds from a consumer’s bank account, line of credit, or credit card.

How it occurs is when a customer complains to their credit card company about the charge on their credit card.  Generally, this is due to a charge that is not recognised by the customer, a failure in customer service or fraudulent use of the card by a 3rd party.

What’s the Chargeback Cyle?

When a customer complains to their credit card, the card company then informs our payment gateway who then reaches into our account with them / our bank account and pulls the money from us immediately.

They then  send out a letter (not e-mail!) informing us of the chargeback and requesting we supply documents to support the purchase.  We are given 10 days to reply with the required documentation and failure to do so in those 10 days is considered grounds for the funds to be withheld.

If the evidence we supplied is insufficient according to the bank, the customer then gets the money they requested returned to them.

Issues with the Chargeback Cycle

There are a number of major issues with this proceeding.  Firstly, funds are drawn immediately from our account on the word of the customer.  Often, it’s just a matter of making a phone call to initiate this.

Secondly, the payment gateways generally charge an additional fee for each chargeback case.  Generally $10-20, no matter if you win or lose.

Thirdly, we are provided a total of 10 days (not business days); but because snail mail is used, we often only get the letter on day 8 or 9.  In a couple of cases, we literally get the letter after the deadline has passed.

Fourthly, the documentation that is requested is often; especially for fraudulent transactions are impossible to meet as an online business.  For example, they require a proof of the card presence (impossible);  an Authorisatoin Log proving the account number was not fictitious (possible by pulling the necessary IP logs), Evidence the Cardholder participated in the transaction (impossible to meet – we get your name and address but that isn’t sufficient evidence).

Potential Fixes?

Due to the recent chargeback, we’re going to have to institute some changes to how we deal with new, large orders.  It’s a series of internal controls and fraud checks, which generally won’t effect existing customers.  However, for rather obvious reasons I’m not going to list them out here. 🙂

However, the entire system is a problem and one that none of the credit card  companies or banks want to change.  It is not in their best interest to.  As a customer, you get your money back immediately so customers generally don’t care.

As the banks / credit card companies, you get to charge the initial gateway processing fee and then the chargeback fee (as above), generating additional revenue.  Since the funds and losses from the fraudulent cases come from the  merchants, they lose no revenue at all.

The only ones losing out are the merchants.  However, since credit card companies are an oligarch, there’s literally nothing that can be done about this.  It’s only if the larger merchants actively take a step and force a change that we will see some, for now, us small business just have to hunker down and hope.

More Mini Board Game Reviews (3)

Once again, I’ve been playing a ton of board games and not had time to review them in detail, so in place of that, here’s a ton of mini-reviews.

St. Petersburg: A classic card drafting strategy game, players go through multiple rounds purchasing workers, buildings, nobles and special cards to provide them additional points and money.  Quite quick to play, it’s definitely stood the test of time and one of my favourites at the moment.

Pirate’s Cove: A light family game, Pirate’s Cove has players deciding to move to one of six islands to ‘raid’ them for their points / treasure chests / doubloons and to upgrade their ships.  The powerful NPC pirate makes things difficult to deal with as do the opposing players whom you have to fight.  It’s a light, fun game – not one I’d choose to play every time, but one that I can certainly enjoy occasionally.

7 Wonders: I’ve only played this a few times, but so far, this is a must-buy if no more than to fit 7 seven players.   One of the few games that makes it easy to  run a fast 7 player game, 7 Wonders is a card drafting game where players hand their new ‘hand’ of cards to their opponents each round, choosing what to lay down based on what their opponents on either side has.  Fun, easy to teach and learn, it’s major problem has been the low-production levels of the cards.

Heroes of Graxia: Another deck-building game, Heroes of Graxia take on this popular new category has players taking on the role of a specific hero.  The major differences between Heroes of Graxia and other deck-builders is the addition of permanent playable heroes that can be equipped / upgraded on the board and the ability to score victory points / end the game by attacking fellow players.  Dealing with a common complaint about deck-builders, Heroes of Graxia is currently the most interactive deck-builder on the market.

Claustrophobia: A dungeon-crawler for 2 players, Claustrophobia comes with some cute painted miniatures and a modular gameboard.  Claustrophobia uses an interesting movement / activation system – the hero player rolls a set of dice equal to the number of characters he has available, assigning the dice and thus the hero’s stats for the turn.  Wounds taken by the heroes remove a line (i.e. a number) from the character sheet, creating an ever dwindling source of strength.  A good, fast to learn and play 2 player dungeon crawler, it might be a tad expensive for a pure 2 player game.

Alhambra: Another classic set collection and hand management game.  It’s not a bad game, and certainly easy enough to teach for beginners but there’s definitely layers of strategy in the base game.  Deciding which groups of buildings to purchase, which to buy to block and making sure to buy with exact change (or not) all make the game  move with an interesting flow.  However, we’ll have to play it a few more times to see if it has lasting power.

Puerto Rico: Strange that I’ve not reviewed this classic game before, but having played it a few times recently, I have to say I’m coming to like it a little better than my initial impressions.  It’s almost a pure information game; so there is a lot of analysis but there’s just enough variations in the plantations to make it random for repeated plays.  However, I’m still not that impressed with it as there’s just a little too little randomness for my liking.

Banner designs and concepts

We recently had to remove the rotating banners that we had been using for the last few years from BGG.  In its place, instead of a constantly rotating, interactive product display we have static banners first designed by me 3 years ago.

I am not happy.   Frankly, I think they are ugly and tired.  Unfortunately, I haven’t been feeling exactly creative recently, having been under the weather for the last month.  Not to mention just a little pinched for time for actual design work.

Worst, I can’t even outsource the work because I am lacking that most important of ingredients – a concept.  Now, I know most designs out there are basically a repeat of one another (board game cover(s) with company name) but I’d rather have something more interesting if I’m paying a professional.  Unfortunately, without at least the start of a concept, it’d get expensive fast if I hired someone to work on it.

Which leads me to the lack of concept.  I know I want something that plays with our current castle logo and name, something slightly more unique than a game cover.  Beyond that though… I’m drawing a blank.

Anyone have any ideas?

Thunderstone the Deck-Building Game Review

Thunderstone‘s a deck-building game, the second to be released actually.  It’s an interesting game, though the rules have received a ton of revisions since it’s release to help deal with certain issues that cropped up during mass gameplay.  The latest editions all incorporate the change  though it’s worth noting this when reading other reviews. Overall, it’s still my favourite deck-builder; over that of Dominion mostly due to the higher level of theme.

Appearance: The card artwork in Thunderstone is average.  The artwork isn’t great or bad, it’s about average.  It certainly is more generic than say, Ascension; but it certainly is prettier than some of the work you’ll see in Dominion.  On the other hand, it’s not jaw-dropping great either.

Card stock wise; it’s pretty good.  The cards will wear down; but it’ll take quite a few games before it becomes noticeable.  Our set has seen over 20 plays so far and there’s no real major damage to any of the cards.

With regard to the insert & sorting – it’s pretty bad.  The initial game box’s insert isn’t very useful, and the various ‘divider’ cards aren’t much better.  The expansion – Wrath of the Elements – takes a lot of steps to fixing this; but if you just get the base game, be prepared for a lousy sorting system.  Rubber bands are definitely recommended.

Rules / Ease of Learning: Thunderstone is a deck-building game, so players all start out with the same deck of cards.  They then must choose to either visit the village to purchase a new card for their deck or the dungeon to battle monsters.   The monsters in the dungeon are generally how you win the game as they provide victory points, but they also provide XP which can be used to upgrade your Heroes.

In the Village you can purchase Heroes, Spells, Items & Villagers who can add to your attack ability, provide more gold or Light or add more ‘Buys’ or other rule-breaking abilities.  As you develop your deck, you’ll be able to deal more damage allowing you to take on the more challenging monsters in the Dungeon.

In Thunderstone, players can choose to attack any one of three face-up monsters.  Monsters who are further away from the ‘entrance’ of the dungeon require additional light sources to fight without penalty.  If a player does not manage to beat the monsters, these monsters are discarded to the bottom of the deck and a new monster is drawn.

Gameplay: Thunderstone is quite a fun game to play.  It’s not quick though – where Dominion can finish in 20 minutes, Ascension in 30 – 45; Thunderstone generally ranges from an hour to an hour and a half depending on the Village deck.

I like the fact that you get to choose which Monster to fight as well as the Heroes that you choose to use.  The variety of strategies available will of course depend on the cards that come out, but with so many Village cards offered, there’s quite a huge replay value.  Turns in Thunderstone are also quite fast – there aren’t that many cards that allow you to ‘pull’ from your deck constantly unlike Dominion; which makes every player’s turn relatively quick.

However, there are certain issues with the game.  It’s quite obvious that certain Heroes are better than others, especially with certain Village cards.  In addition, depending on the monsters that arrive; combat can be atrociously slow (e.g. Doomknights that increase the light penalty when there are no additional light sources / heroes in the Village). Also, as the number of cards with the ability to redraw cards are low; bad luck can play a seriously adverse effect on a player’s chances of winning.  This really is an Ameritrash version of a deck-building game.

Conclusion: I like Thunderstone because of it’s higher themed content and to some extent, the greater randomness.  Playing the game, I feel that I’m actually building an adventuring party with a set goal – unlike Dominion which feels a touch themeless at times.

Current Bestselling Board Games : April 2011

We have our most recent bestsellers list up on the site.  In addition, we’ve created a new pre-order list for our Most Popular Pre-Order Board Games.

As a comparison; here’s the bestsellers from the month of February2011.

Innovation

1. Innovation

2. Pandemic

3. Dominion

4. Dominion : Prosperity

5. Forbidden Island

6. Dixit

7. Glory to Rome

8. Labyrinth : War on Terror

9. Bang : the Bullet

10. Dixit 2