You work hard for your money. Sadly, there are people working just as hard to steal it from you. 

Preventing Fraud: You Are the Key to Foiling Credit Card Fraudsters

December 4, 2013


You work hard for your money. Sadly, there are people working just as hard to steal it from you.

Every year, businesses lose billions — yes, billions — of dollars because of credit card fraud. While last year the overall number of losses decreased, the amount of fraud experienced by small businesses continued to go up. And who's on the hook when you accept a fraudulent credit card? More often than not, it's you.

Don't let this trend discourage you. Fraud can be prevented. And fraud prevention starts with you.

What's Happening Today

Because debit cards are typically less prone to fraud, these additional credit card users mean businesses likes yours will be assuming more risk.

Swift changes in technology, including the use of mobile devices to make payments, pose challenges for retailers as well. As Internet sales continue to increase, so does the number of ways criminals can obtain fraudulent credit card information.

While the Internet allows businesses to sell in markets previously thought unreachable, fraud tends to be higher in international sales.

The ways that fraudsters try to take your money may change over time, but your role in preventing fraud does not. You can protect your business. It's easy, once you have a good understanding of your business and your customers — and you know how to spot the enemy.

Know Your Business

Think about your frontline — the person or place where the card presents for purchase. Whether it's a team of cashiers, a department that fills two floors in a downtown high-rise, or a computer system that flags suspicious activity, it's your job to make sure that your frontline knows how to protect your business.

Arm your frontline by teaching them about fraud. Tell them how fraud affects your business, and don't forget to tell them how fraud affects them personally. For instance, could a decrease in fraud increase annual raises or holiday bonuses? Would an increase in fraud force you to switch to a less comprehensive health plan?

Know Your Customer

You know best who typically buys your products or services. Their likes, their dislikes, the time of day they typically buy, the quantity of items they usually purchase: train your people to understand your customers.

Of course, there will always be exceptions. But knowing your customer provides clues that can help you and others identify the enemy.

Know Your Enemy

The easiest way to deny a fraudster is to know who you're looking for. Trust your gut while paying attention to:

  • The purchase. Watch for the customer buying large quantities of expensive merchandise — particularly if the item is easily sold for cash. Would your typical customer buy six flat screen televisions? Does your typical customer ask questions — about warranties, quality, or upcoming sales? A fraudster usually won't.
  • Timing. A fraudster may try scamming you just after the store opens or right before you close. She may try to rush through the transaction. Or maybe she completes one purchase and quickly returns for another large purchase. Do you really think she "forgot" to pick up that diamond bracelet?
  • Demeanor. Is he avoiding eye contact? Talking too little? Or too much? Maybe his voice is shaking or he has trouble answering simple questions. Is he trying to distract you? Actions. Be aware of where the card came from. Did she pull the card out of her pocket instead of her wallet? If you ask for ID, does she claim that her ID is at home? Does she sign the receipt slowly — and overly deliberately?
  • Delivery. How the product is — or isn't — delivered can also be a red flag. Look for customers who refuse delivery on items that you typically deliver. For internet sales, flag first time customers who ask for rush shipments, particularly those to international addresses, P.O. Boxes, or mail receiving-services.

Internet or phone-based businesses should pay attention to requests for shipment to a single address when payment has been made using multiple cards. Customers completing transactions with one card — or cards with similar or sequential account numbers — that have a single billing address but request shipment to multiple addresses are also of concern. Finally, check customer's IP address. Multiple cards used from a single IP address can also indicate fraud.

Trust Yourself…But Don't Go It Alone

While you and your team are the best line of defense, you're not alone. TSYS offers tools and support that can help you protect your business from fraud. Our processing platform includes fraud-detecting software that monitors each transaction for suspicious activity. We'll call you if a questionable transaction takes place.

And, you'll always have access to the latest information on fraud, as TSYS representatives collaborate with card issuers, government agencies, and fraud-fighting groups.

You've worked too hard to let fraudsters get the best of you. Trust your instincts. And trust TSYS to help you and your business succeed. Learn more about our secure payment processing including the transition to EMV terminals.

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