Chargeback Alert: The Fraud Patterns Every Liquor Store Should Know

The Red Flags We're Seeing Across Liquor Stores

One of the biggest advantages of the Liquor Bee network is that we get to see trends happening across hundreds of liquor stores. Sometimes those trends involve new products, changing buying habits, or inventory patterns. Unfortunately, sometimes they involve fraud.

Over the past several weeks, we've seen an increase in attempted credit card fraud and chargebacks that follow almost the exact same playbook. While every situation is different, the warning signs are becoming remarkably consistent.

If It Sounds Too Good to Be True...It Probably is...

One lesson continues to prove itself over and over:

If something feels off or sounds too good to be true, it probably is.

Fraudsters are often confident, persuasive, and in a hurry. Their goal is to pressure employees into completing a transaction before anyone has time to think critically.

Taking an extra minute to verify the transaction can save hundreds—or even thousands—of dollars in lost inventory and chargebacks.

The #1 Red Flag We're Seeing

Without question, the biggest trend we've noticed is the purchase of cases of Don Julio.

Don Julio has become one of the hottest targets because it's:

• High value

• Easy to resell

• In high demand

• Readily available in many liquor stores

While buying Don Julio certainly doesn't make someone a criminal, we've seen enough fraudulent attempts involving entire cases that it should immediately prompt additional scrutiny.

If someone you've never seen before wants to manually key in a credit card to purchase multiple cases of premium tequila, your fraud radar should be going off.

Common Warning Signs

Here are several patterns we've repeatedly seen in fraudulent transactions:

Multiple Declined Cards

The customer attempts one card after another after another.

Sometimes they'll pull out several different cards hoping one eventually works.

This often indicates they're testing stolen card numbers until they find one that authorizes.

"It Only Works If You Manually Enter It"

This is one of the most common stories we hear.

The customer claims:

• "The chip is broken."

• "The tap doesn't work."

• "You have to key it in."

• "It always does this."

In many cases, they don't even have the physical card associated with the stolen card number they're attempting to use.

Remember that manually keyed transactions carry substantially more fraud risk than chip or contactless transactions.

High-Dollar Premium Liquor

Fraudsters rarely target inexpensive products.

Instead, they typically purchase:

• Cases of Don Julio

• Premium bourbon

• High-demand allocated products

• Expensive tequila and whiskey

These products can often be resold quickly for cash.

Rushing the Cashier

A common tactic is creating urgency.

They may become impatient, irritated, or push employees to "just run it."

Any customer who becomes upset because you're verifying their identity should raise concern.

Our Rule of Thumb

We've shared this advice with many Liquor Bee stores, and it's one of the easiest ways to think about manually keyed transactions:

If you wouldn't accept a personal check from this person, you probably shouldn't accept a manually keyed credit card either.

That simple question can prevent many fraudulent sales.

If You Choose to Accept a Manually Keyed Card

Sometimes manually keyed transactions are legitimate. When they are necessary, we strongly recommend taking a few extra precautions:

• Verify a government-issued photo ID.

• Confirm the name on the ID matches the credit card.

• Have the customer sign the receipt.

• Ensure security cameras clearly capture the transaction.

• Retain any documentation that may help if a chargeback or police report becomes necessary.

These few extra steps can dramatically improve your chances of successfully fighting a fraudulent chargeback.

Trust Your Instincts

Your employees interact with customers every day. They develop a strong sense for what feels normal.

If something doesn't feel right, don't ignore that instinct.

Declining one suspicious sale is far less expensive than losing an entire case of premium liquor and the payment that comes with it.

At Liquor Bee, we'll continue sharing fraud trends as we see them across our network.

The more informed our customers are, the harder we make it for fraudsters to succeed.

Stay vigilant, ask questions, and when in doubt, trust your instincts.