Preventing Credit Card Fraud at Your Place of Business

by John Burke

2 min read

Accepting credit cards can help drive up business revenue, but fraud can threaten those revenue increases. If you want to reap the benefits of credit cards and reduce the risk of fraud, there are several things you should keep in mind.

Physical Signs of Fake Cards

Some clever fraudsters steal credit card numbers and create their own fake cards. To ensure you don’t accidentally run these cards, always do a quick visual scan of every card you accept. The embossed numbers should be uniform, the magnetic stripe should look like a smooth part of the card, and the hologram should make a 3-D image.

Credit Card Processors

It’s also important to keep security in mind when choosing your credit card processor. Companies that process credit cards have safety nets in place to detect and prevent fraud, and you need to choose a company that understands and abides by the Payment Card Industry Data Security Standard. The PCI DSS is a set of international standards that includes requirements related to maintaining a secure network, encrypting transactions, monitoring networks, and much more. If you have your own merchant account, you may be personally responsible for meeting their standards, so it’s important to understand what they are.

Online Fraud Prevention

To eliminate credit card fraud online, make sure your ecommerce software has authentication features in place. Potential safeguards include address verification and requiring CVC numbers (the three-digit number on the back of all cards). If you see an unusual online transaction come through your online retail business, you may want to contact your client or customer before dispatching the shipment.

New Technology

You should also keep abreast of new changes in the way cards are processed. It’s also important to understand how potential changes may impact your liability for fraud.For example, imagine that the credit card companies roll out a new security element. Typically, if you update your system, you are not liable for fraud. However, if you continue to use an old system that does not have that particular security element in place, you may become liable for any fraud that occurs.

Hiding Numbers

Never make your customers’ or clients’ card numbers visible in any way. In particular, make sure the full credit card number never prints on receipts. Also, if your website saves credit card numbers to make checking out or paying invoices easier for your clients, the full number should be encrypted, and only the last four numbers should display on the website. In rare cases, when you need to write down a credit card number, run the transaction right away and then shred the number. This prevents credit card numbers from being stolen and used for fraud.

Employee Considerations

In addition to preventing people from using fraudulent cards at your business, you also want to ensure that your employees don’t steal credit card information. To prevent this, you may want to do a criminal background check of employees. You may want to let employees deal with financial transactions only after they have been with the company for a set period of time.

References & Resources

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