# Payment Fraud

> Payment fraud is any type of illegal or unauthorized transaction carried out by a cybercriminal to gain money or property.

- **URL**: https://dodopayments.com/glossary/payment-fraud

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## What is Payment Fraud?

Payment fraud is any type of illegal or unauthorized transaction carried out by a cybercriminal to gain money or property. This often involves the use of stolen credit card information, identity theft, or manipulating payment systems to divert funds.

### Why It Matters

- It causes direct financial losses for businesses through lost inventory, shipping costs, and chargeback fees.

- High levels of fraud can lead to a merchant being placed in monitoring programs by card networks, resulting in higher fees.

- It erodes customer trust and can damage a brand's reputation if users feel their financial data is not secure.

## Learn More

- [How MoR providers handle chargebacks](https://dodopayments.com/blogs/merchant-of-record-chargebacks)
- [Handling refunds and chargebacks as a solo founder](https://dodopayments.com/blogs/handle-refunds-chargebacks-solo-founder)
- [Dunning management playbook](https://dodopayments.com/blogs/dunning-management)