The Better Business Bureau (BBB) of Minnesota and North Dakota has warned of the growing danger of so-called 'friendly fraud', where existing customers carry out fraud to obtain items free of charge.
According to the Wall Street Journal, some companies have seen a significant increase in this type of fraudulent activity in the past 12 months and as such businesses are increasingly seeking ways to protect them from the activity.
One way suggested by BBB is to use address verification
technology to confirm the buyer's billing address before sending out merchandise.
Simply paying for an address verification
system will often be sufficient to root out friendly fraud and many businesses have already deployed this solution, Hometown Source reports.
"There is nothing nice about friendly fraud. The negative impact on businesses is doubly painful, because not only do businesses lose the merchandise, but they also are out what they should have made on the sale," Dana Badgerow, president and chief executive of the BBB of Minnesota and North Dakota, told the publication.
Address data is increasingly being used by companies as part of their customer relationship management (CRM) solutions.
Firms such as Hyundai and Uniglobe are using CRM solutions, combined with high levels of address data quality, to improve their contact with customers.