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Reducing the chances of payment fraud at your business




Credit card fraud can happen at your brick-and-mortar store, on the telephone or online, putting customers’ sensitive information at risk. Spotting fraudulent activity can be difficult during online or telephone transactions since the customer and the card are not present. However, knowing the signs of suspicious activity can help minimize the risk of credit card fraud at your brick-and-mortar store.

While there is no 100 percent-accurate test to identify fraud, being able to identify certain behavioral queues and credit card characteristics can help you stop fraudulent activity before you become a victim. They also complement tools like chip cards and EMV acceptance designed to help you stop acceptance of fraudulent credit cards at the point of sale.

Customer behavior

You've seen a lot of customers walk through your door and you know how the average customer acts. If a customer is exhibiting strange behavior it should raise a red flag. Keep an eye out for instances where the customer:

Appears nervous, is rude or wants to rush the transaction.
Does not have a physical card and instead recites a credit card number from memory.
Has a higher-than-average transaction amount and/or purchases large amounts of jewelry, electronics or computer equipment.
Distracts the clerk or tries to draw attention away from the credit card.
Purchases random merchandise with little regard for size, color or cost.
Buys a large number of expensive items.
Looks at the name on the card or the signature on the back of the card before signing the slip.
Admits he's "been having trouble" with his card.
Completes purchase and then returns a short time later to buy more items.
Shops right after the store opens or just before it closes.
While any one of these behaviors could be entirely legitimate, if you witness a customer exhibiting several of these actions, be weary: they could pose a risk of making a fraudulent purchase.

Physical credit card characteristics

In addition to peculiar behavior, you should also be on the lookout for counterfeit or manipulated credit cards. Carefully scrutinize any transactions where:

The first number doesn't match the typical card brand format (American Express = 3, Visa = 4, MasterCard = 5, Discover = 6)
Credit card numbers appear crooked, unevenly spaced, re-embossed or otherwise tampered with.
Certain characters or numbers are not the same height and style as others on the card.
The signature appears smudged or altered.
The magnetic stripe is scratched or destroyed.
The hologram is damaged or appears dull.
Education is vital
American Express suggests talking to employees about the four crucial C.A.R.D. factors to watch out for during card-present transactions in order to protect sensitive customer information. Employees should confirm the following appear on every credit card used to make a transaction.

(C) - CID number: This flat three- or four-digit number appears on the card.

(A) - Account number: Make sure the front, back and last four digits on the charge record match.

(R) - Real cardmember: The signature should always be present and match the name on the card.

(D) - Date: Only accept credit cards that are still valid and unexpired.

Your employees are the first line of defense in protecting your business from credit card fraud. Be sure to educate them on what to look for and emphasize they use proper procedures when processing credit card transactions.

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