Recognizing Affiliate Fraud

There have been a number of discussions recently on linkedin with regard to affiliate program fraudulent leads and sales. We all know that affiliate programs are a great way to drive traffic to websites, lead gen programs and specific offers. The majority of the publishers that participate in the affiliate programs are extremely reputable. Most affiliate sites do a great job of prequalifying the publishers before they ever see an advertiser’s offer. Unfortunately, even with all the safe guards, there is still some lead fraud that comes through affiliate programs.
There are a few key things that can tip an advertiser off to potential fraud and give them a chance to rectify the problem before it becomes out of hand. One indicator that there may be a problem is if there are a large number of leads from the same IP address in a very short amount of time. On the same token, sequential email addresses for a lead generation program can also indicate unwanted activity. For example if you have Lars1@aol.com, Lars2@aol.com etc there is a pretty good indication there is a problem. Obviously a large number of invalid credit card numbers also indicate invalid activity. Additionally if one publisher has a much higher click to offer completion ratio than other similar sites, it may be a situation that warrants investigation. This may just mean the publisher has exceptionally well qualified traffic. But, it is still worth looking into.
There is typically a larger amount of fraud that comes through incentive publishers, those sites that offer points or actual cash for completing offers. Many of these sites have very strict policies to curb member fraud. Others do not. Incentive traffic is not all bad. Finding sites that have clear policies on valid and accurate offer completion is key if you want to advertise on these type of sites.
Affiliate programs remain one of the best resources to reach small publishers who are interested in your specific offers. Being diligent about watching the traffic coming from the various publishers and keeping in close contact with your affiliate manager are important in making these programs successful.

Originally posted by blarson