Unpredictability and Fraud

Oliver “Shiny” Blakemore
The Chargeback Maze
3 min readFeb 9, 2024


Anti-fraud strategy has to be responsive enough in the current climate.

Without strong strategy, merchants essentially gamble trying to predict whether chargeback losses will be nil or cost millions.

CFOs have a vested interest in reducing risk exposure. It’s a large part of their professional responsibility. Fraudulent attacks are always possible and always a danger to any business that runs a lot of e-commerce. Fraud is a nightmare to forecast, which is bad news for financial officers who want to build forecasting data libraries to make long-term strategies.

Chargeback disputes throw one of the biggest wrenches in data forecasting. If an anti-fraud strategy isn’t responsive enough to the current climate, it will be essentially a gamble trying to predict whether chargeback losses will be nil or cost millions.

Eliminating that unpredictability in chargeback predictions becomes an essential concern in a lot of organizations. Better forecasting allows more confidence in approval of planned business strategy. Collaborating with third parties, if they’re the right third parties, helps eliminate that unpredictability by shifting accountability.


In this context, a financial investment creates accountability. An accountable partner will take on the responsibility to finance costs of chargebacks. They will also maintain revenue for service-level agreements, or SLAs. Ideally, they use three mechanisms to do it…

  • A lowest possible share of orders approval by the partner through an approval-rate SLA. A partner might, for example, commit to approving ninety-seven percent of orders for an agreed on period of time, like three years. Taking on these approvals empowers a CFO with more data to accurately forecast revenue.‍
  • Through a chargeback guarantee, a partner takes on the costs of fraudulent chargeback disputes. The partner will reimburse the merchant for chargeback costs when a cardholder reports a partner’s order approval as a fraud.‍
  • Create a fee structure that rewards partners for approved transactions and disincentivizes declining too many orders. A performance-based fee structure will be a key part of a chargeback guarantee that encourages partners to improve revenue and put in the effort to find valid approvals.

In the interest of shared accountability, these measures bring a partner’s goals in line with a merchant’s. It encourages a partner toward accurate assessments of incoming chargeback disputes. In addition, it will give a merchant’s fraud partners reasons to keep their business practices adaptive and nimble and put their resources in the best tools that come out in the fraud detection and prevention space.

All this comes together to empower a CFO with the best data to create long-term budget strategies. Involving a fraud partner shifts the liability of paying chargebacks out of the mainstream of a merchant’s daily business.

Third-party Accountability and Improved Predictability

The unpredictability of fraud reporting is one of the industry’s consistencies. A sophisticated fraud attack can hit a merchant at any time. Merchants often react conservatively, relying on “tried” methods. The problem is, tried methods tend not to be true methods when it comes to fraud prevention. The fraud industry, and it is an industry, relies on conservative reactions, since professional fraudsters do most of their business by exploiting the next new flaw in security.

In the unstable forecasting environment that fraud creates, accountable fraud management creates a higher level of predictability. When they’re doing their job right, accountable fraud partners improve ROI predictions, which gives a CFO more tools to reduce uncertainty and increase revenue. Improved forecasting in all areas of business, especially the unpredictable area of fraud, means better strategy.

Why More and More Businesses are Switching to Dispute.com



Oliver “Shiny” Blakemore
The Chargeback Maze

The best part of being a mime is never having to say I’m sorry.