Fraudulent Card Payments Safeguards

Fraudulent Card Payments Safeguards

There are a number of steps you can take to reduce the risk of fraudulent card payments.  Training is crucial - you should draw up a clear list of security measures for accepting card payments and make sure all your employees are fully aware of them.

Talk to the bank providing you with your merchant account.  Ask them what card security measures they recommend.

Safeguards

When the cardholder-is-present you should:

• Check the card hasn't been reported lost or stolen by checking against warning notices issued by card providers or by calling the card provider - your terminal will also check when it seeks an online authorisation.
• Make sure that the PIN entered verifies the transaction, or where an old-style card is being used that the signature matches the one on the back of the card.
• Check that the card is in the form it should be and hasn't been tampered with - ask your bank for a card-recognition guide.
• Check with your bank's authorisation phone line if the card won't swipe - this can happen for innocent reasons but it may indicate a fake card
• Beware of people who seem nervous or who try to distract you as you're processing their purchase.
• Look out for people making hurried and seemingly random purchases, eg several pairs of designer sunglasses or high-priced electronics

For cardholder-not-present transactions, you can:

• Where you have the facility to validate, ask for the card security code - usually the last three digits of a sequence of numbers on the signature strip or, in the case of an American Express card, four numbers on the front of the card.
• Ask customers ordering by phone to bring their card when collecting goods.
• Ask for faxed confirmation of the order with a signature and proof of address.
• Use an online database to check the name and address details you've been given with those held by the company which issued the card.
• Use the Address Verification Service offered by the bank providing your merchant account, which checks the numeric details of the cardholder's statement address with the card issuer.