Who are Bust-Out Merchants?

Bust-Out Merchants are individuals or businesses that engage in fraudulent activities, specifically by making a series of legitimate transactions initially to build trust and gain access to valuable resources, such as credit or goods. Once they have established this trust, they typically execute a 'bust-out' by either disappearing after maximizing their transactions or purchasing high-value items with little intention of paying for them. This fraudulent behavior is primarily aimed at exploiting the system by creating an appearance of legitimacy before switching to unethical conduct.

This understanding highlights the significance of vigilance and due diligence in transaction monitoring to prevent fraud while underlining the nature of these merchants as deceptive and opportunistic. The identification and management of risk related to such merchants are crucial in ensuring the integrity of the marketplace, further emphasizing why this classification as providing fraudulent services is accurate.