Report: Florida Tops List of Riskiest States for E-Commerce Merchants

March 3, 2016

Report: Florida Tops List of Riskiest States for E-Commerce Merchants To all e-commerce merchants: beware of orders originating in Florida; Delaware; Washington, D.C.; Oregon and California. Data analytics and fraud prevention provider Experian examined millions of e-commerce transactions and found the highest rates of fraudulent transactions were billed to customers in those places. The riskiest states associated with fraudulent shipping addresses were Delaware, Oregon, Florida, California and Nevada. Knowing, from a geographic standpoint, where the most risk lies, is valuable information for e-commerce merchants doing everything they can to curtail CNP fraud.

The riskiest single billing ZIP code, according to Experian? Eudora, Kan., a suburb of the university city of Lawrence about halfway between Kansas City and Topeka. According to Experian senior vice president of Fraud & Identity, Adam Fingersh, even though some sense can be made of many of the places on the list, and therefore merchants can scrutinize transactions that originate from or ship to those places, Eudora’s appearance exemplifies one of the challenges inherent in CNP fraud.

“The data showed that e-commerce fraud is not confined to larger cities since fraudsters can ship items anywhere and e-commerce fraud can happen anywhere,” Fingersh said. “This was the case in point with Eudora, Kan. The area was not among the riskiest ZIP codes all year until the week of Black Friday and Cyber Monday as online traffic created a significant increase in attack rates.”

Other locations were more intuitive. From both a billing and shipping perspective, Experian found, Florida and Oregon are where the action is.

“Florida is attractive for several reasons including its location, population of the state and the high volume of transactions creating more opportunities for fraudsters to take advantage of,” noted Fingersh. “Our data showed that areas near large ports attracted higher shipping fraud attack rates. Florida, and Miami for that matter, is a major hub for international commerce, with its proximity to the Caribbean and South America along with the airports and ports handling quite a bit of commerce and international trade. Miami is known as the UN of South America and in this case it was also home to many of the riskiest ZIP codes ranked by shipping fraud attack rates.”

Aside from Florida and Oregon—which also contains a major port city—only Delaware, California, New York, Georgia, Nevada and Puerto Rico rank higher than the national average attack rate threshold for both kinds of fraud.