Noam Marko
by Noam Marko • May 25, 2017

Everybody likes to take a vacation, leaving behind everyday worries and spending some time at a great resort, visiting famous sites or enjoying a luxurious hotel. The affordable prices in much of the tourist industry allow more and more people to travel and see the world.

But unfortunately, there is also a dark side to the low-cost opportunities presented by the travel industry. Have you heard about the “once-in-a-lifetime” deal? It comes in various forms. It might be half price flight tickets, a huge hotel suite for the cost of an ordinary room, or cut price Disneyland tickets. Well, sometimes those offers are for real. But usually when it’s “too good to be true” – that’s because it isn’t true at all. It's a form of ecommerce fraud.

There's Always a Catch

Many of those super-saver vacation deals are bought on dodgy websites, or are purchases made by fake travel agents, using fraudulent payment methods (for example – stolen credit cards).

Here’s the catch. While the purchase itself is fraudulent, in most cases the person who shows up for the flight, or to stay in the hotel or enter the theme park, is a legitimate customer. The unlucky traveler is sure he paid hard-earned money to a travel agent for a great deal. So he did. Unfortunately, the travel agent was a fake who stole the money and used data stolen from someone else to make the purchase, fraudulently.

This fraud is causing triple damage for the vacation seller:

  1. Reputational damage, since the genuine (if gullible) customers often blame the vacation seller rather than the fake agent when they don’t get the service they paid for.
  2. Accusations of unfair charging. The consumers whose stolen details were used don’t know about the fake agent – they too blame the vacation seller for charging them for services they never ordered. (This kind of anger can be seen in forms such as Facebook posts about “the airline who charged me for a flight I never took.”)
  3. Chargebacks caused due to the stolen payment methods.

Furthermore, fake travel agents are much more sophisticated than the average fraudster. After all, they are ecommerce fraud professionals. Setting up as a fake travel agent takes an investment of time, effort and often some money on their side. Those who do it, know what they’re doing. For them selling stolen vacations is an easy way to make quick profits. They specialize in this form of fraud, which means they have the opportunity to get really good at it.

The Anaheim Example

One example we encountered recently is a persistent fraudster who tried to order expensive hotel rooms near Disneyland in Anaheim, California. The fraudster provided real personal details of his ‘customers’, which made the transactions seem very legitimate. Nevertheless, the fraudster wasn’t smart enough to hide certain elements in his behavior which made the transactions very suspicious.

His behavior simply didn’t match the typical behavior of a real customer making this sort of purchase. It’s not about everyone following a specific set of steps, it’s about doing the things that someone fitting this persona would do. A parent booking a family holiday behaves differently to a student booking a group trip, for example. Faking the right behavior with accuracy is hard – and this fraudster wasn’t up to it.

He also fell into the trap of predictability; he had a specific way of working, tiny elements that added up to an identifiable pattern. It was as good as a cowbell around his neck, as far as our automated system was concerned. Having identified him originally on behavioral elements, before he even reached checkout, it was able to flag him every time after that as a repeating offender.

The fraudster continued trying to purchase hotel rooms for about a month, but he eventually gave up when our automated system continued to reject his attempts.

The Rise of the Fake Travel Agent

Many "travel agent" fraudsters have emerged in the last year or two, working on perfecting methods of hiding their identity and blending into the crowd of legitimate customers.

We have heard a number of stories from vacation providers about a sudden uptick in chargeback rates in a specific flight route or group of hotels. And we’ve heard this, too, more than once: “We know it’s the same guy stealing from us, but it is impossible for us to separate him from the crowd.”

Well, like the fraudsters, Forter’s fraud prevention system is constantly evolving, by leveraging the research, analysis and expertise of Forter’s team of experts.

To read more about fraud in the online travel industry and how Forter’s solution defeats it, check out our Flying with Fraud fact sheet.