As credit cards have become more popular in the past few decades at the same time that the internet and other technologies have become ubiquitous, credit card fraud has become an increasingly common occurrence. Most everyone knows someone whose credit card number has been used fraudulently, but what about the merchants that are victims to these crimes? Unlike the cardholders who are able to contact their banks to remove fraudulent charges, when merchants accept these stolen cards, they are the ones that pay. Listed below are the primary strategies for ecommerce fraud prevention.
Fraud Prevention Tips
- If you think a transaction might be fraudulent, DO NOT PROCEED WITH THE ORDER until you are comfortable
- Do not assume because a transaction is approved that it is not fraudulent. When a card-issuing bank issues an approval code, the only thing they are telling you is that there are funds available on the card and that the account is open
- When running a card-not-present transaction, run AVS (address verification system), keeping in mind that AVS does not work outside of the United States and that oftentimes credit card thieves have correct address information
- Use CVM (3-digit code on back of card) when running card-not-present transactions. Credit card thieves will be less likely to have this data
- Keep records of previous fraud attempts on your business including email address, IP address, and all other aspects of the order. Oftentimes, credit card thieves will go back to the same business. If they are ever successful, having these records will be useful to law enforcement should you choose to report the incident.