4 Ways to Protect Your Business by Identifying Scam and Fraud Card Transactions
March 19, 2020
As digital technology continues to advance in amazing leaps and bounds, our financial lives become more streamlined and functional every day. Unfortunately, every new technology invites criminals to devise schemes to exploit developing systems. Businesses who accept and process payments through credit and debit cards are prime targets from modern-day fraudsters. Credit card companies will look to hold vendors responsible for illegal transactions that they accept when possible, and every company that accepts card payments should be on constant alert against scams and fraudulent transactions. The best defense against fraud and liability is strict observance of best transaction practices.
Watch For Unusual Or Nervous Shoppers
There are some common sense clues that a customer might be using a stolen or fraudulent card.
Be cautious of shoppers who make large purchases without asking any questions or without regard to cost. Customers who are unusually anxious to rush a sale or to distract a cashier when checking out should also raise suspicion. Watch out for customers who make unusual purchases and then return to your store later to make similar purchases, or customers who show up at your store as soon as it opens or right at closing time.
Be aware of any unusual behavior at check-out. If a customer pulls their card out of a pocket instead of their wallet or purse, they may have just stolen the card or they may be unfamiliar with how people ordinarily carry their cards. Be on alert if a customer asks that their card be keyed rather than swiped or if they act unusually nervous when giving their signature.
Common sense observations and awareness will usually reveal an unsophisticated criminal’s attempt to use a stolen or fraudulent card.
Look For Card Irregularities
Make a habit out of quickly but carefully examining cards at check-out. The first four digits of a card number printed on a card must match the embossed digits. Look out for altered or removed embossed numbers. Every valid card’s hologram should be intact and undamaged. Cards that have been illegally re-embossed will typically have a damaged hologram. Look for any characters that not aligned or mismatched in size or shape. Altered signature panels are also red flags for alteration.
Be Suspicious of Unusual Purchases
When customers make unusual consumer purchases, you probably will want to ask some questions. Someone buying a large number of the same item, such as electronics or multiple copies of a video game, may be attempting to steal small items that can be quickly resold. Also be wary of someone who quickly selects a variety of expensive clothes that are mismatched in size and style.
When an in-person exchange with a cardholder would normally be expected, pay attention when customers avoid coming in to make payment. Criminals and scammers are often very hesitant to physically appear with a fraudulent or stolen card and may give you all sorts of excuses for wanting to pay over the phone.
Never get involved with any customer requests to send money to a third person through a card transaction, including bank and wire transfers. Do not engage in any transactions for services that are outside of your company’s normal course of business.
How To Handle Questionable Purchase Attempts
Any time you are suspicious of a card when presented, ask the customer to show their government photo ID. If the customer cannot produce a satisfactory ID or if you feel confident that the purchase is fraudulent, refuse the sale. If you have any other questions or concerns, call your card processing company for assistance in handling the transaction.
Your employees are likely to handle most, if not all, of your card transactions. It is essential that they are all trained in the fraud prevention methods we have discussed, and that they are invested in protecting the company from liability for accepting fraudulent payments. For large or questionable purchases, your employees should be trained to always involve a manager or owner in accepting the transaction.
PayHub Payments offers innovative and seamless payment processing for your brick and mortar retail spaces and your eCommerce stores. We are your partner in processing all types of card and electronic payments efficiently and at a fair, honest, and transparent rate. Your business’s security and success is our highest priority, and we will always assist in every way possible to avoid losses through fraud. Our unmatched customer service will make the savings we can provide even more attractive.