We've found that fraud vs. genuine closely matches the percentage of assholes and psychopaths in the general population, somewhere ~1% to 2%. And just like in meat-space these people are the cause for increased prices and frustrating checkout experiences - i.e. payment holds and refusals.
The problem is said people can do so much damage to a profit margin as they tend to hit an online store hard and quickly, racking up huge potential reversal costs. For us, being in a specialized digital space makes this especially painful as the digital items can be "used" and no longer resell-able or recoverable, so inventory and real dollar value is lost.
Visa / MC has no real incentive to stop the fraud as the merchant in most cases is liable for the reversal - Visa / MC is just a facilitator that bends towards keeping the buyer happy (same with PayPal). 3DSecure was introduced over a decade ago to alleviate some fraud based on unauthorized \ unknown but uptake has been anemic due to poor buyer experience.
As for converting stolen card to profit, purchasing and delivering high ticket physical items online and reselling is one known method.
The problem is said people can do so much damage to a profit margin as they tend to hit an online store hard and quickly, racking up huge potential reversal costs. For us, being in a specialized digital space makes this especially painful as the digital items can be "used" and no longer resell-able or recoverable, so inventory and real dollar value is lost.
Visa / MC has no real incentive to stop the fraud as the merchant in most cases is liable for the reversal - Visa / MC is just a facilitator that bends towards keeping the buyer happy (same with PayPal). 3DSecure was introduced over a decade ago to alleviate some fraud based on unauthorized \ unknown but uptake has been anemic due to poor buyer experience.
As for converting stolen card to profit, purchasing and delivering high ticket physical items online and reselling is one known method.