Affiliate marketing, where you pay per click or per action for your ad to appear on another website or on a search engine results page is a hot form of marketing these days, but it is not without risk. Affiliate fraud, where your ad is clicked merely to generate a charge for the ad network, is a serious problem and something you need to watch out for if you decide to use this sort of advertising.
Who Commits Affiliate Fraud, and How?
Affiliates, networks, merchants and buyers have all been known to commit affiliate fraud. Fraud by affiliates is both automated and manual. When the payment model is pay per click, a program that clicks on your ad (called a Clickbot) is often used to generate hundreds or thousands of clicks. When the payment model is pay per sale, unscrupulous affiliates may use stolen or invalid credit cards to try to make purchases for the sole purpose of generating a commission fo... [Read Full Article]