The Riskiest ZIP Codes for eCommerce Fraud

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Not only is eCommerce fraud on the rise (it’s up 15% in the U.S. from last year), but research shows that certain ZIP codes are more prone to fraudulent charges than others, reports Digital Transactions.

Data specialist, Experian, analyzed two different types of fraud – shipping fraud, which is connected to the address of where the purchased goods are sent (person committing the fraud), and billing fraud, which is related to the address of the buyer (fraud victim).

According to Experian’s findings, the riskiest ZIP code for shipping-address fraud is Eudora, Kan., a small town of nearly 6,300 residents with a 66025 ZIP code.

The riskiest ZIP code for billing fraud, however, is Houston’s 77036, with Eudora coming in second.

Miami, an international shipping hub, appears to be far riskier than the entire state of Kansas, however, with six of the 15 riskiest shipping ZIP codes and four of the top 10 riskiest billing ZIP codes.

Experian analyzed millions of eCommerce transactions from the first half of 2016 to determine the riskiest areas. Fraud attack rates are calculated by comparing bad transactions to the total number of transactions.

What’s with the Uptick?

The increased fraud in Eudora seems to be caused by a small ring of unethical players, Mike Gross, fraud and identity director of risk strategy at Experian, told Digital Transactions. The city of Eudora as a whole – aside from one or two addresses – is fairly normal. “It could be a ring that is not based in Eudora but they’re using that address to ship to and [packages] then go somewhere else,” he said.

Many of the higher risk ZIP codes and cities are located near a large port-of-entry city, which is why they are ideal locations for reshipping fraudulent goods. So it makes sense that the states of Florida, California and New York account for 44% of eCommerce billing fraud and 52% of eCommerce shipping fraud.

The Top 10 Riskiest Billing/Shipping ZIP Codes in the United States:


  1. Houston, 77036
  2. Eudora, Kan., 66025
  3. Miami, 33192
  4. Miami, 33166
  5. Homer, Alaska, 99603
  6. Miami, 33195
  7. Winchester, Ill., 62694
  8. Central Lake, Mich., 49622
  9. Miami, 33136
  10. Harrington, Del., 19952


  1. Eudora, Kan., 66025
  2. Miami, 33195
  3. Miami, 33192
  4. Miami, 33166
  5. Nettleton, Miss., 38858
  6. Winchester, Ill., 62694
  7. South El Monte, Calif., 91733
  8. Central Lake, Mich., 49622
  9. Elizabeth, N.J., 07201
  10. Houston, 77036

Download the 2016 Experian top 100 fraud attack rate ZIP code rankings.

Reducing eCommerce Fraud Risk

In an effort to minimize eCommerce fraud risk, EMVCo is developing 3D Secure 2.0., which is a messaging protocol that allows consumers to directly authenticate their card with Mastercard, Visa, Discover and American Express when shopping online.

It’s expected to be released in July 2017 and, unlike its current version, 3D Secure 2.0 will be mobile friendly and designed to work in apps.

Additionally, merchants themselves can take action by encouraging consumers to submit orders on their smartphones. “The more traffic [merchants] can push into these online channels, the better they are at recognizing fraud and finding their best customers,” Gross told Digital Transactions.

Learn More About How to Reduce eCommerce Fraud Risk:

Contact i3 Merchant Solutions online or call 1-800-621-8931

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