Visa Reason Code 10.4: Other Fraud - Card Absent Environment

Visa reason code 10.4 signals a cardholder claim that a card-not-present transaction (online, phone, or mail order) was unauthorized. This is one of the most challenging dispute types to win and carries significant freeze risk for Stripe merchants.

What 10.4 Fraud Means in Practice

Visa code 10.4 (“Other Fraud - Card Absent Environment”) is issued when:

A cardholder claims they did not authorize an online, phone, or mail-order transaction
The issuing bank suspects the card details were stolen or compromised
The transaction occurred in a card-not-present (CNP) environment without chip verification

Unlike friendly fraud (where customers claim non-receipt), 10.4 is a true fraud claim where the cardholder denies any knowledge of the purchase.

Common Triggers

Stolen card credentials used for online purchases
Account takeover where fraudsters access customer accounts
Family fraud where a family member uses the card without permission
Unrecognized billing descriptor causing legitimate cardholders to report fraud

How Issuers Evaluate 10.4 Claims

Banks prioritize cardholder protection in fraud cases. Their decision process:

Cardholder statement: Did the customer file a police report or affidavit?
Transaction pattern: Does it match the cardholder’s typical behavior?
Authentication: Was 3D Secure (Visa Secure) used?
Merchant evidence: Is there proof the actual cardholder participated?

Default position: Issuers side with cardholders on fraud claims unless you provide compelling evidence that the legitimate cardholder authorized the transaction.

Win Likelihood: Low (15-25%)

Win probability: Low

You can improve your odds only if you have:

Strong Evidence That Wins

✅ 3D Secure authentication (Visa Secure, 3DS2) showing cardholder completed verification
✅ AVS and CVV match confirming billing address and card security code
✅ Device fingerprinting showing transaction from customer’s known device
✅ IP address history matching previous successful orders
✅ Customer communication (emails, chat logs) discussing the purchase
✅ Account activity showing customer logged in and used the product/service
✅ Delivery confirmation to verified address with signature (for physical goods)

Evidence That Rarely Works

❌ Proof of delivery alone (doesn’t prove the cardholder ordered it)
❌ Terms and conditions acceptance (can be fraudster)
❌ Generic transaction records without authentication
❌ Customer service notes without direct cardholder verification

Freeze Risk Assessment: High

Freeze risk: High

Why 10.4 disputes are dangerous:

Fraud clustering: Multiple fraud disputes signal systemic security issues to Stripe
Velocity triggers: 2-3 fraud disputes in a 30-day window can trigger holds
Pattern recognition: Stripe’s algorithms flag merchants with elevated fraud rates
Network penalties: Visa monitors fraud rates and can impose fines

Critical thresholds:

0.5% fraud rate: Monitoring begins
0.75% fraud rate: Reserve or hold likely
1.0% fraud rate: Account freeze risk becomes severe

Even one 10.4 dispute counts toward your fraud rate, separate from your general dispute rate.

Prevention: Stop 10.4 Disputes Before They Happen

Essential Fraud Prevention Tools

3D Secure (3DS2): Shifts liability to issuer when authentication succeeds
Address Verification Service (AVS): Validates billing address matches card
CVV verification: Confirms customer has physical card
Stripe Radar: Machine learning fraud detection (included with Stripe)
Device fingerprinting: Track and flag suspicious devices
Velocity checks: Limit transactions per card/IP in short timeframes

Operational Best Practices

Clear billing descriptors: Use recognizable business name on statements
Email confirmations: Send immediate order confirmation with clear merchant name
Customer verification: For high-value orders, call to verify
Shipping address validation: Flag mismatches between billing and shipping
Suspicious order review: Manually review orders with fraud signals

Clear Verdict: When to Fight vs. Refund

Fight Only If You Have:

✅ 3D Secure authentication logs
✅ Proof of customer account activity post-purchase
✅ Device/IP match with customer history
✅ Direct communication with verified cardholder
✅ Low current dispute rate (less than 0.5%)

Refund Immediately If:

❌ No 3D Secure or strong authentication
❌ First-time customer with no history
❌ Suspicious order signals (mismatched addresses, VPN, etc.)
❌ Already elevated dispute rate (greater than 0.75%)
❌ Multiple fraud disputes in past 60 days

Strategic refund: If you’re near freeze thresholds, refunding weak fraud cases before they become disputes can save your account. The $15 dispute fee is cheaper than a reserve or freeze.

Response Timeline

You have 7-21 days (varies by processor) to respond with evidence. Missing the deadline = automatic loss.

Action plan:

Day 1: Review transaction for authentication and fraud signals
Day 1-2: Gather all evidence (3DS logs, device data, communications)
Day 3-5: Build compelling narrative with evidence
Day 5-7: Submit response via Stripe Dashboard

What to Submit If Fighting

Your evidence package should include:

Authentication proof: 3DS logs, AVS/CVV match results
Device evidence: IP address, device fingerprint, browser data
Customer activity: Login timestamps, product usage logs, downloads
Communication: Emails, chat logs, support tickets
Delivery proof: Tracking, signature (physical goods only)
Narrative: Clear explanation connecting evidence to legitimate cardholder

Format: PDF with clear sections, timestamps, and annotations. Make it easy for the reviewer to see the cardholder participated.

Assess Your Dispute Risk (30 seconds)