As if running a small business isn’t hard enough, merchants must be on guard for scams that seem to be lurking in the shadows.
Indeed, it is increasingly difficult for merchants to keep up with scammers as fraud becomes more sophisticated, automated and prevalent, according to Visa Acceptance Solutions.
Flooring retailers are facing a multi-dimensional, high-stakes-threat landscape. In the past year, U.S. businesses lost an average of 9.8% of their revenue to fraud, representing a 46% jump from 2024, according to OrboGraph, which provides innovative AI-based technology to the banking and remittance industries.
The flooring industry is far from immune to these threats, whether it’s cyberattacks such as ransomware, widespread credit card fraud or check-washing scams.
Here’s a closer look at what’s happening out there:
Credit card threats
The “fake credit card” threat has evolved beyond simple plastic replicas into complex digital ecosystems.
AI-generated synthetic identities: Fraudsters use AI to blend stolen social security numbers with fabricated data to create “synthetic” people who can pass standard verification and open retail credit accounts.
Magecart and digital skimming: Criminals inject malicious code into online checkout pages to “skim” payment info as it’s entered. Over 23 million transactions were compromised this way in 2025 alone, according to Entrust’s Payment Fraud Report.
Automated card testing: Bots run thousands of small-dollar tests on retail sites to see which stolen card numbers are active before reselling them.
Deep fakes: Criminals now use deep-fake technology to bypass biometric facial recognition and voice authentication, allowing them to pose as legitimate customers.
The check whitewashing surge
Despite the decline in check usage, check fraud now accounts for 30% of all fraud losses in the U.S. Chemical washing removes the original payee and amount, allowing criminals to write in new, much larger figures. Recent high-value cases include a $27 million U.S. Treasury check scam.
Retailers on alert
For flooring retailers, the question isn’t have they been scammed, it’s when will they be?
Bob’s Carpet & Flooring, with 17 locations in the Tampa area, had to wait weeks to get its data back after a catastrophic security breech, according to Ashlie Butler, president. Her suggestion: “Back up your data frequently and keep it separated from your main system, if possible. I’m no expert by any means, but having to wait weeks to get your data back can be brutal, if not crippling.”
For several years, Butler and her team have instructed its RSAs on how to handle potential scam calls. “Now, when one store gets a suspicious call, they immedi a t e ly alert all other locations,” she said. “But when it comes to cyberattacks such as ransomware, there’s only so much you can do—and most of it seems to be on the offense. We do what we can, carry insurance, etc.”
Butler also recommended dealers talk to their managed service providers to determine if they are using the best security suite. “Even if everything is done right, these threats can come from trusted suppliers, which can infiltrate even well-protected networks.”
Several dealers told FCNews they have been victimized by check-washing schemes. “We’ve been targeted by check washing and ACH fraud, but our use of Positive Pay and ACH positive pay has prevented any financial impact to date,” said Susan Hadinger, president of Hadinger Co. of Naples. “As these scams continue to evolve, we make it a priority to regularly review and upgrade our safeguards to try and stay ahead of emerging threats.”
Positive Pay is an automated bank fraud detection service that matches a company’s issued check or ACH data against presented payments, rejecting unauthorized discrepancies to prevent fraud. It acts as a security checkpoint, flagging mismatched amounts or account numbers for review before funds are taken.
Similarly, Ted’s Floors & Beyond in Anniston, Ala., was the victim of check washing—not once but several times during the early part of 2025. Ted Gregerson, president, said he also used the Positive Pay program. He logs onto the website every morning and manually approves every check that is being presented that day for payment. “It is a pain to have to do it, but I will say that once we implemented it and started doing it early on we caught about five checks that had been washed and were being presented for fraudulent payment. Once we caught those, it seems the crime organization figured it out and left our checks alone.”
The most common type of fraud is with credit cards and can come in a variety of ways. In some cases, the “consumer” will call up and order flooring to be picked up. “In my case, they call with an out-of-town phone number, barely speaking intelligible English, attempting to pick up large quantities of any type/color of flooring, paying with a card over the phone and sending someone in the area to come pick up the materials almost immediately,” said John Bretzloff, president of Barefoot Flooring, Castle Hayne, N.C. Sensing the red flags, Bretzloff said they shut these would-be transactions down at once by asking them to visit the store in person, with ID matching the credit card being used for the purchase. “No one ever shows, of course.”
Sadly, many other dealers can relate. Haight Carpet & Interiors, Woodinville, Wash., only recently had some orders go out that were paid for by what turned out to be a stolen credit card. “The legitimate owner of the card flagged it as fraudulent a week or so later and Visa charged us back,” said Mark VanderGiessen, owner. “We’ve historically had some good policies here; we just had to tweak them a bit. When we don’t know the buyer, cash and carry sales must be paid in person, and we check ID. We have also started to collect ID from the person picking up an order if we don’t know them. It feels a bit like whack-a-mole. You figure out how they’re taking advantage of you—and solve for that—just in time to learn the new scheme.”
To protect their assets, some dealers have moved data storage to the cloud. That’s what Ben Boss, owner of Dixon, Ill.-based Boss Carpet One Floor & Home has done. “Additionally, our co-op, CCA, has been great about pushing us to stay protected by providing a reliable source for cyber insurance to make sure we’re covered from every angle.”
In recent years, Carpet Exchange, with 17 stores in the Denver market, has tightened its security measures. As president/ owner Bruce Odette explained, “Our servers are protected with multiple firewall layers, including CrowdStrike, and all of our PCs are covered by Bitdefender GravityZone Enterprise. For credit cards, we rely on Chase and their built-in fraud protection, which is extremely strong. The biggest risk we still face is people clicking on malicious links or attachments in emails. That’s just the reality everywhere. The good news is that if something slips through, Bitdefender alerts us immediately so we can address it quickly.”
The post Dealers deploy tactics to fight online scams appeared first on Floor Covering News.
Dealers deploy tactics to fight online scams Posted First on https://fcnews.net
No comments:
Post a Comment