Company
Date Published
Author
Martin Capodici
Word count
2899
Language
English
Hacker News points
None

Summary

Referral fraud is a significant issue in referral programs used by businesses to drive sales, as fraudsters exploit these systems to gain undeserved rewards and discounts, often causing financial losses and operational inefficiencies. Various types of referral fraud include creating fake accounts using bots, exploiting promo codes through referral farming, and orchestrating return abuse to profit from referral payouts. Such fraudulent activities not only lead to direct monetary losses due to chargebacks and refunds but also skew marketing data, making tracking and optimizing campaigns more challenging. To combat referral fraud, businesses can implement measures such as verifying referrer details, monitoring referral activity for unusual patterns, setting referral limits, and using advanced device intelligence solutions like Fingerprint to detect and prevent fraudulent activities. These strategies help ensure the effectiveness of referral programs and protect against financial and reputational damage.