The 5 most common types of travel fraud (and how you can fight them)

You work hard to provide seamless, memorable experiences to your customers. You’re not just offering flights, rooms or tours - you’re delivering experiences based on trust. But fraud is eroding that trust, quietly costing the industry billions. In fact, the global travel industry loses over $25 billion to fraud each year, and that number is growing.

Here’s a look at the most common types of travel-related fraud targeting your industry, and what tools are available to protect you.

The problem:: Fraudsters use stolen credit card information to book flights, hotels, or tours. The transaction goes through, the service is delivered, and later a chargeback hits. You lose the money and the service.

How to avoid it:: Smart algorithms and fraud screening tools can analyse transaction behavior and flag sketchy transactions before you get scammed. Use tokenized payments so your real card details stay hidden, making it much harder for fraudsters to steal them. Make sure to monitor for any unauthorised use of your brand and report fraudulent websites.

The problem: A scammer books using a stolen card and claims they “overpaid.” They request a refund to a different card or account. Once the original transaction is reversed, you’re out double the money.

How to avoid it: Establish clear and concise refund and return policies that outline the conditions under which refunds or returns will be accepted. Keep a close eye on any unusual overpayment activity or refund requests that don't match your standard policies. For added protection, take a multi-layered approach to fraud prevention, combining manual oversight with advanced technology, such as AI or machine learning, to analyse transaction data and identify suspicious behaviour.

The problem: Fraudsters clone your branding - photos, name, even your website - and set up fake booking portals. Customers unknowingly pay them, thinking they’re paying you. The result? Lost revenue and damaged trust.

How to avoid it: Secure your digital presence by implementing secure and trusted payment gateways who offer 3D Secure Authentication as well as fraud detection features and encryption. Offer your customers clear contact information (phone numbers, email addresses and physical addresses) that they can use to verify your services. Also ensure all your social media accounts are verified, helping customers to distinguish legitimate profiles from impersonators.

The problem: A customer books a trip, takes it, and then disputes the charge with their bank. You lose the revenue, plus time and effort trying to fight it. Friendly fraud now accounts for approximately 60-80% of all chargebacks..

How to avoid it: Clearly outline terms and conditions, making sure customers are fully aware of your booking, cancellation and refund purchases. Use clear and recognisable merchant names on documents to avoid confusion and keep detailed records of every transaction and communication, so you’re ready to respond to disputes. Secure payment platforms can flag high-risk transactions before they become a problem. See Ecommpay’s guide to chargeback fraud for expert support.

The problem: Scammers send fake “confirmation” emails using your company name, requesting additional payments or updated details. Customers fall for it - and you get blamed. A significant percentage of cyberattacks begin with phishing attempts - reports indicate 91% of all cyber attacks start with phishing emails.

How to avoid it: Use secure, branded communications that your customers trust and secure payment platforms that travelers can use to verify transactions. Never send sensitive payment requests via email without secure links and educate your customers on when an email or text is legitimate. Consider implementing multi-factor authentication (MFA) for high-value bookings.

Fraudsters are getting more sophisticated, but so are the tools available to stop them. By staying informed, building in layers of payment protection, and using smart verification processes, you can significantly reduce the risk of fraud and give your customers the confidence to keep booking with you.