When most merchants think about the holiday season, they focus on things like inventory, staffing, marketing campaigns, and increased customer demand. Fraud prevention often gets pushed further down the priority list until the busy season is already underway. Unfortunately, that’s exactly what fraudsters are counting on.
At Wind River, we encourage merchants to start thinking about holiday fraud prevention much earlier in the year. Taking a proactive approach gives you time to identify vulnerabilities, strengthen security measures, train employees, and create a plan before the busiest time of year.
The businesses that experience the smoothest holiday seasons are often the ones that start preparing earlier in the year.
August: Evaluate Your Current Fraud Exposure and Strengthen Your Defenses
August is a good time to take a closer look at your current payment environment and begin addressing any gaps.
A good place to start is by reviewing chargeback activity, suspicious transactions, customer disputes, and any fraud incidents that occurred over the past year, especially during the previous holiday season. You may find that certain products, services, customer segments, subscription plans, or sales channels consistently experience greater fraud risk.
You should also make sure to review your business’ PCI compliance status and ensure that you are following current payment security best practices. PCI compliance helps reduce security risks and may limit liability in the event of a data breach of payment information.
This is also an ideal time to review your existing security measures by asking yourself a few key questions:
Are you using EMV credit card terminals for card-present (in-person) payments?
EMV terminals help reduce fraud by using chip-enabled technology that offers an added layer of protection to keep the card information secure from fraudsters.
Are online transactions protected with tools such as Address Verification Service (AVS) or CVV validation?
These tools are used to help identify transactions that may be fraudulent before they result in chargebacks or financial losses. AVS compares the billing address entered by the customer at checkout to the address that is on file with the card issuer. CVV is the security code that is printed on the back of the physical credit card, requiring the customer to have the card with them before making the purchase.
Do you monitor unusual transaction activity?
It is important to proactively look for unusual purchasing patterns, repeated declined transactions, sudden spikes in activity, or transactions from unfamiliar locations. Doing this can help you identify issues earlier and respond quickly.
Are employee access permissions limited to only individuals that need them?
The more people who have access to payment data or processing systems, the greater the potential risk. Regularly reviewing user permissions helps reduce the chances of internal errors, unauthorized access, and account compromise.
Are customer accounts protected?
If customers can store payment information or manage accounts online, review your account security practices. Multifactor authentication, password policies, login monitoring, and alerts for unusual account activity can help reduce the risk of account takeover fraud.
This is also a great time to review your policies surrounding refunds, returns, customer verification, and suspicious transactions. Clear guidelines help employees make consistent decisions when pressure increases during the holiday shopping season.
Related Content: Essential Security Strategies for Today’s Businesses
September: Focus on Employee Training
While technology plays an important role in fraud prevention, employees remain one of the most effective defenses against fraud. Whether your payments take place in-person, online, or both, training your employees on how to recognize fraud is key.
A 2025 study found that organizations using ongoing security awareness training reduced employee phishing susceptibility by 86% within one year, demonstrating the significant impact employee education can have on fraud prevention.
September is an ideal time to provide practical fraud awareness training. Employees should understand how to identify suspicious behavior and know what steps to take when something appears unusual.
Examples of what to discuss with employees include:
- Multiple declined cards followed by a successful transaction: Repeated payment attempts may indicate card testing or the use of stolen payment credentials. Employees should know when to escalate these situations for additional review.
- Unusually large purchases with expedited shipping: Fraudsters may attempt to use stolen payment information on high-value items and expedite the shipment to arrive before it can be detected. Large or unexpected purchases may need to be escalated for additional verification.
- Repeated refund, return, or chargeback activity: Frequent refund requests or payment disputes may be a sign that someone is taking advantage of your policies or trying to avoid paying for products or services.
- Suspicious account activity: If your business allows customers to create accounts and store payment information, look for multiple login attempts, password reset requests, or sudden changes to customer account information. These can all be signs of account takeover fraud.
The goal isn’t to make employees suspicious of every customer. Instead, it is to help them recognize warning signs and feel comfortable escalating concerns when necessary.
October: Test Your Processes Before Peak Season Arrives
By October, many merchants begin launching holiday promotions and preparing for increased transaction volumes. This makes it the best time to test the systems and procedures you’ve been implementing up until now.
Imagine discovering on your busiest sales day that an important fraud prevention tool isn’t functioning properly or that key alerts weren’t set up correctly. Testing beforehand helps avoid these costly surprises.
Review how fraud alerts are handled, confirm that payment security tools are functioning as expected, and ensure reporting systems are generating accurate information. It can also be helpful to conduct internal exercises that walk employees through how they would respond to different scenarios, such as suspected card fraud, disputed transactions, or chargeback notifications.
This is also a good time to connect with your payments provider. They should be able to share trends they are seeing across the industry and recommend additional safeguards based on your type of business.
November: Stay Alert During Peak Shopping Events
Once Black Friday, Cyber Monday, and other holiday sales events arrive, fraud prevention efforts should move into active monitoring.
When your business is processing more transactions than usual, suspicious activity can be easier to miss. You should watch for things like repeated purchase attempts, unexpected increases in transaction activity, or customer behavior that doesn’t match typical buying patterns.
For online sellers, reviewing certain transactions before fulfillment may help prevent costly chargebacks later. Retail e-commerce chargeback rates increased 233% during 2025, making chargebacks one of the fastest-growing fraud-related expenses for merchants.
The busiest days of the shopping season often bring the greatest risk of fraud, making consistent monitoring essential.
Related Content: How to Protect Your Business from Costly Chargebacks
December: Don’t Let Security Take a Back Seat
As the holiday rush reaches its peak, businesses often become so focused on serving customers that security procedures may begin to slip.
Employees should continue following established verification procedures, refund policies, and fraud review processes, even when workloads are heavier. Fraudsters often look for moments when businesses are overwhelmed because those moments can make fraudulent activity easier to hide.
Maintaining the same standards in December that you established in the fall can help reduce losses and protect both your business and your customers.
Related Content: Holiday Online Fraud Trends: What Every Merchant Should Know
January: Learn From the Season
The holiday season doesn’t truly end when the calendar changes.
January provides an opportunity to evaluate what worked well and what could be improved. Review fraud incidents, chargebacks, employee feedback, and security performance. Understanding where problems occurred can help you strengthen your defenses for the following year.
The insights gathered after the season are often some of the most valuable information available for future planning.
Start Earlier, Stress Less
Holiday fraud prevention is not something that can be implemented successfully overnight. The most effective strategy is a gradual, thoughtful process that begins well before the holiday shopping season arrives.
By using the remaining summer weeks to evaluate risk, strengthen security measures, train employees, and test procedures, you can enter the holidays with greater confidence and fewer surprises.
At Wind River Payments, we believe the best way to go about fraud prevention is to be proactive and not reactive. A little preparation now can go a long way toward protecting revenue, reducing chargebacks, and delivering a safer experience for your customers during the busiest time of the year.
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