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Alva Digital Downloads

Understanding Fraud Prevention

Learn how Alva Digital Downloads’ fraud prevention system protects your digital products from fraudulent orders.

What is Fraud Prevention?

Section titled “What is Fraud Prevention?”

Fraud prevention automatically reviews orders for suspicious activity before granting access to digital files. This protects you from:

❌ Stolen credit cards - Fraudsters using stolen payment info ❌ Chargebacks - Customers claiming fraud after downloading ❌ Digital piracy - Bad actors redistributing your files ❌ Account takeover - Compromised customer accounts ❌ Bulk fraud - Organized fraud operations

How Fraud Prevention Works

Section titled “How Fraud Prevention Works”

The Process

Section titled “The Process”
1. Customer places order
   ↓
2. Payment processed (Shopify)
   ↓
3. Fraud check initiated (Alva)
   ↓
4. Shopify analyzes order risk
   ↓
5. Decision:
   → Low Risk: Files delivered immediately
   → High Risk: Held for review
   ↓
6. You approve/reject manually
   ↓
7. Files delivered (if approved)

Automatic vs. Manual Review

Section titled “Automatic vs. Manual Review”

Automatic (Low Risk Orders):

  • Shopify fraud analysis: Low risk
  • Files delivered immediately
  • No merchant action needed
  • 95%+ of orders

Manual Review (High Risk Orders):

  • Shopify fraud analysis: Medium/High risk
  • Files held automatically
  • You review and decide
  • Approve or reject
  • 5% of orders typically

Shopify Fraud Analysis

Section titled “Shopify Fraud Analysis”

What Shopify Checks

Section titled “What Shopify Checks”

Shopify’s built-in fraud analysis examines:

✅ Billing Address - Matches card? ✅ Shipping Address - Consistent with billing? ✅ IP Location - Matches customer location? ✅ Email Domain - Legitimate email provider? ✅ Order History - New vs. returning customer? ✅ Velocity - Multiple orders quickly? ✅ Device Fingerprint - Known fraudulent device? ✅ Payment Method - High-risk payment type?

Risk Levels

Section titled “Risk Levels”

Shopify assigns risk levels:

Low Risk 🟢

All indicators normal
Likely legitimate customer
Auto-approve by default

Medium Risk 🟡

Some suspicious indicators
Could be fraud or legitimate
Hold for review (if enabled)

High Risk 🔴

Multiple fraud indicators
Likely fraudulent
Definitely hold for review

Why Enable Fraud Prevention?

Section titled “Why Enable Fraud Prevention?”

Benefits

Section titled “Benefits”

Protect Revenue:

  • Prevent chargebacks (saves $15-25 per chargeback)
  • Avoid refunding fraudulent purchases
  • Maintain payment processor relationship

Protect Products:

  • Stop pirates from stealing files
  • Prevent mass unauthorized distribution
  • Control who accesses content

Maintain Reputation:

  • Lower fraud rates
  • Better standing with payment processors
  • Professional business operations

Peace of Mind:

  • Automated protection
  • Review before delivery
  • Catch issues early

When to Enable

Section titled “When to Enable”

Strongly recommended if:

  • ✅ Selling high-value digital products ($50+)
  • ✅ Experiencing chargebacks
  • ✅ Selling to international customers
  • ✅ New store (less than 6 months)
  • ✅ Noticed suspicious orders
  • ✅ Sell easily-redistributable content

May not need if:

  • Small transactions ($5-10)
  • Established customer base
  • Low chargeback history
  • Very niche market
  • Strong customer relationships

Fraud Prevention vs. Order Fulfillment

Section titled “Fraud Prevention vs. Order Fulfillment”

With Fraud Prevention Enabled

Section titled “With Fraud Prevention Enabled”

Low risk order:

Order paid → Fraud check → Low risk → Files delivered immediately
Time: 5-30 seconds

High risk order:

Order paid → Fraud check → High risk → Held for review → You approve → Files delivered
Time: Minutes to days (your review speed)

Without Fraud Prevention

Section titled “Without Fraud Prevention”

All orders:

Order paid → Files delivered immediately
Time: Instant

Risks:

  • Fraudulent orders get files
  • Discover fraud after download
  • Chargeback but file downloaded
  • No recovery possible

What Customers Experience

Section titled “What Customers Experience”

Low Risk Orders

Section titled “Low Risk Orders”

Customer perspective:

  1. Complete checkout
  2. See download on Thank You page
  3. Receive email (if enabled)
  4. Download files immediately

Experience: Seamless, instant access

High Risk Orders (Held for Review)

Section titled “High Risk Orders (Held for Review)”

Customer perspective:

  1. Complete checkout
  2. See “Processing” message
  3. No immediate download
  4. Email says “Order being verified”
  5. Wait for approval
  6. Receive download when approved

Experience: Slight delay, but understandable

Fraud Prevention Settings

Section titled “Fraud Prevention Settings”

Risk Level Threshold

Section titled “Risk Level Threshold”

Choose which orders to review:

Option 1: Review Medium + High Risk

  • More orders held
  • Maximum protection
  • More review work

Option 2: Review High Risk Only (Default)

  • Fewer orders held
  • Good protection
  • Less review work

Option 3: Review None (Disabled)

  • No orders held
  • No protection
  • No review work

Email Notifications for Merchants

Section titled “Email Notifications for Merchants”

Get notified when high-risk orders need review:

Enable notification emails:

  1. Go to Settings → Fraud Prevention
  2. Enable Email Fraud Alerts
  3. Enter notification email (can be different from shop email)
  4. Save

Notification includes:

  • Order number
  • Customer name
  • Risk level
  • Link to approve/reject

Auto-Fulfillment Integration

Section titled “Auto-Fulfillment Integration”

Automatically mark Shopify orders as fulfilled when files delivered:

Enable auto-fulfillment:

  1. Settings → Fraud Prevention
  2. Enable Auto-Fulfill After Approval
  3. Save

Benefits:

  • Clean order workflow
  • Proper order status in Shopify
  • Triggers other automations

Fraud Indicators to Watch

Section titled “Fraud Indicators to Watch”

Common Red Flags

Section titled “Common Red Flags”

🚩 Multiple Orders, Same Customer

  • Many orders in short time
  • Different payment methods
  • Suspicious velocity

🚩 High-Value First Order

  • New customer
  • Large purchase
  • Expensive digital product

🚩 Mismatched Information

  • Email doesn’t match name
  • IP location differs from billing
  • Billing ≠ shipping address

🚩 Suspicious Email Addresses

  • Temporary email services
  • Random characters
  • Multiple orders, similar emails

🚩 Unusual IP Locations

  • High-fraud countries
  • VPN/proxy detected
  • IP doesn’t match customer location

Fraud Statistics

Section titled “Fraud Statistics”

Industry Averages

Section titled “Industry Averages”

Digital product fraud rates:

  • Average: 2-5% of orders
  • High-risk stores: 10-20%
  • Protected stores: Under 1%

Average chargeback cost:

  • Lost product: $X (product value)
  • Chargeback fee: $15-25
  • Admin time: 1-2 hours
  • Total: $30-$100+ per incident

Prevention ROI: Preventing just 1-2 fraudulent orders per month pays for itself.

Balancing Security and Experience

Section titled “Balancing Security and Experience”

Finding the Right Balance

Section titled “Finding the Right Balance”

Too Strict:

  • Many legitimate orders held
  • Customer frustration
  • Lost sales
  • Negative reviews

Too Lenient:

  • Fraudulent orders slip through
  • High chargeback rate
  • Payment processor issues
  • Lost revenue

Just Right:

  • Most legitimate orders auto-approve
  • Suspicious orders reviewed
  • Minimal customer friction
  • Maximum protection

Fraud Prevention Limitations

Section titled “Fraud Prevention Limitations”

What It Can’t Do

Section titled “What It Can’t Do”

Not foolproof:

  • Can’t catch all fraud (99% effective, not 100%)
  • Sophisticated fraudsters may bypass
  • Legitimate orders occasionally flagged

Can’t prevent:

  • Customer sharing files after download (against terms)
  • Legitimate purchases later disputed
  • Account takeover before order

Doesn’t replace:

  • Terms of service
  • Download limits
  • IP restrictions
  • Other security measures

Fraud Prevention Best Practices

Section titled “Fraud Prevention Best Practices”

1. Enable for High-Value Products

Section titled “1. Enable for High-Value Products”

$50+ products: Always enable $20-50 products: Strongly recommended Under $20: Consider based on risk tolerance

2. Review Flagged Orders Promptly

Section titled “2. Review Flagged Orders Promptly”

Target review time: Within 24 hours

Benefits:

  • Better customer experience
  • Reduce support tickets
  • Catch fraud early

3. Document Decisions

Section titled “3. Document Decisions”

Keep notes on why you approved/rejected orders:

  • Helps with patterns
  • Useful for chargebacks
  • Improves future decisions
Section titled “4. Monitor Fraud Trends”

Check fraud metrics monthly:

  • Percentage flagged
  • Approval rate
  • Chargeback rate
  • False positive rate

5. Combine with Other Protections

Section titled “5. Combine with Other Protections”

Layer security:

  • Fraud prevention
  • Download limits
  • IP restrictions
  • Expiring links
  • Terms of service

Fraud Prevention Costs

Section titled “Fraud Prevention Costs”

Included in App

Section titled “Included in App”

Fraud prevention is included in all Alva Digital Downloads plans:

  • No additional cost
  • No per-check fees
  • Unlimited fraud checks

Uses Shopify’s existing fraud analysis:

  • No third-party services
  • No API costs
  • Leverages Shopify data

Getting Started

Section titled “Getting Started”

Enable Fraud Prevention

Section titled “Enable Fraud Prevention”
  1. Go to Settings in Alva app
  2. Find Fraud Prevention section
  3. Toggle Enable Fraud Prevention to ON
  4. Choose risk threshold:
    • High Risk Only (recommended to start)
    • Medium + High Risk
  5. Enable email notifications (optional)
  6. Click Save
  1. Test with new order
  2. Monitor flagged orders in Flagged Orders page

Next Steps

Section titled “Next Steps”