Report Any Suspicious Activity Immediately
When you notice something strange, dont put it off. Report the activity immediately to minimize how much damage can be done. If possible, call the number on the back of your credit card, not one provided in an email or over the phone by a stranger. This way you know you are calling your financial institution and they will be able to better assist you.
Be sure to get a case number and be ready with any information you can provide, such as dates, times, descriptions of people involved and what they said while taking the card or trying to make purchases. This information will help law enforcement identify and arrest the criminals.
Easy Ways Your Business Can Avoid Credit Card Fraud
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Accepting credit cards is important for any business, but protecting your business to avoid credit card fraud is just as important. With credit card fraud on the rise, it is crucial for you to know and understand how you can prevent fraudulent charges occurring at your business.
The Nilson Report estimates that in 2016, credit card fraud losses topped $24.71 billion, which is a 12 percent increase over the previous year, and according to a Barclays report, 47 percent of the worlds credit card fraud happens right here in the United States.
As reported by a Kaspersky Lab survey, small businesses spend $38,000 to recover from a security breach, with additional indirect costs averaging around $8,000. Enterprise businesses pay on average $551,000 to recover with additional indirect costs averaging at $69,000.
As credit card fraud becomes increasingly more relevant, there are ways to protect your business against credit card fraud.
International Bancard put together six easy ways that your business can avoid credit card fraud:
Dont Store Your Credit Card Information On Websites
Not only does storing your credit card number on a website expose it to that site and any hackers trying to commit credit card fraud, but also to anyone else who might use your device, like kids, co-workers, or spouses. If your login information is saved and your card is stored, its easy for someone with access to your device to log in as you and buy whatever they want. In a recent survey of web users, we found that over half of them hated having to enter and reenter payment information. We know its tedious, but if you dont want to use virtual credit cards that can auto-fill this information for you, then manually filling it in ensures that no other users of your computer/device have easy access to your credit card information.
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What To Do If Youre A Victim Of Credit Card Fraud
Contact your financial institution immediately if your credit card is lost or stolen. Contact it if you find payments on your credit card statement that you didnt make or approve.
If you think youre a victim of credit card fraud:
- write down what happened and how you first noticed the fraud
- contact your credit card issuer to tell them about the fraud
- take notes of who you talked to and when you spoke to them
- keep all documents that you think might be helpful when the police investigate the fraud
- contact your local police service to file a complaint
- contact other accounts that could be tampered with by the person
Run A System Check And Virus Scan On Your Computer
If you do most of your internet baking on your home computer then its important to protect your computer against viruses and spyware. Here at Westpac, we offer a free system check and virus scan as part of Westpac Security Tools to help you maintain your online protection. Viruses and spyware can infiltrate your computer via general web browsing and downloading infected files however, installing virus protection software will help guard your computer.
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Access Control For Credit Card Fraud Prevention
Once youve implemented the strategies of data minimization and network segmentation for credit card fraud prevention, the natural next step is to administer an effective access-control system. In order for the two previously mentioned strategies to be viable, you must control who has access to the sensitive data in question and determine what their appropriate level of access should be. For example, a desk agent or call center operator should not have permission or the ability to view your entire database of credit card information. This would generate unnecessary risk and increase the potential damage from an intrusion by allowing anyone with that individuals login credentials to also access that database, adding insult to the injury of a data breach.
Use Different Cards For Autopay Vs Everyday Spending
Consider designating one of your credit cards to be used only for autopay accounts, such as wireless phone bills and website subscriptions. Then dont use that card for anything else. That way, this just-for-bills credit card is not in the wild being processed by retail clerks and restaurant servers, or being swiped through gas station pump readers. Use other payment cards for everyday spending.
This technique wont prevent fraud on your everyday spending card, but if one of the cards is breached, at least you wont have the hassle of changing your autopay accounts and potentially incurring a late-payment fee.
Generally, its a good idea to keep a record of where your credit card number is stored.
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Dont Forget To Update Passwords
Set unique and complex passwords when using online banking accounts and software. Change them regularly to minimize the risk of hackers gaining access to your accounts.
Applications such as 1Password and LastPass can help to store and manage intricate login details, as well as allowing you to share these credentials with employees securely.
Some credit card companies also use technology to make traditional passwords redundant. These may include fingerprint app logins or voice-identity recognition for telephone banking, which are much more effective at verifying the account holder’s identification.
Victim Of Credit Card Fraud
After these three steps, youll need to see if there are any other signs of fraud.
This means going through your bank and credit card statements for the last few months, as well as getting a copy of your credit file. This will help you to see if anyone has used your identity to apply for credit cards or loans without you knowing.
Find out more about what to do if your credit card has been used fraudulently, in our guide Identity theft and scams: how to get your money back
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How Else Can I Protect Myself
The Federal Trade Commission offers these tips: Shop with a credit card online, and never buy anything from online sellers that accept payment only by gift cards, money transfers or cryptocurrency. Such payments are nearly impossible to trace and reverse, and criminals often tell people to use those methods so they can get cash quickly, the commission says.
Vet unfamiliar websites before shopping by searching online for the merchants name and the word complaint or scam, the agency advises, and read the sellers description of the goods carefully. If the seller offers brand-name goods at steep discounts, the agency said, they might be fakes.
The Privacy Rights Clearinghouse also recommends making sure the website shows a tiny lock icon, or https, in the checkout browser, indicating transactions are secure. You can also sign up for alerts from your bank or credit card so you are notified when purchases are made.
The U.S. consumer really needs to be smart, said David Mattei, a strategic adviser specializing in payments fraud at Aite-Novarica Group. If major retailers are out of an item, he said, theres a good chance an online seller you have never heard of doesnt have it, either. And if a website asks for details like your Social Security number, he said, that should be a red flag that the site is not legitimate.
Build Defenses Against Fraudulent Returns
Handling legitimate returns is an important customer service function. Criminals know this, too, and see it as a weak link they can exploit. Whether the return of stolen merchandise, employee return fraud, or the use of counterfeit receipts, return fraud remains a clear and present danger to merchants. The National Retail Federation estimates that 8% of all merchandise returns in the US in 2018 were fraudulent.
You can seamlessly deliver on the legitimate return needs of your valued customers and stay vigilant against fraud. Return policies should be transparent and designed to protect all parties. Minimizing the risk of return fraud starts with awarenessanyone that may be involved in processing returns should be trained to spot common return fraud red flags.
How To Report Credit Card Fraud
You should report any fraud on your credit card by:
Who Is Responsible For Credit Card Fraud
If youve been the victim of credit card fraud, you normally wont be liable for unauthorised payments on the card during the fraud. This is because youre covered under the Consumer Credit Act 1974.
The Act means you can claim back the money you lost due to fraud.
There are two circumstances that would mean you would not get all the money back though.
Here are some examples of when your bank might say you were negligent and wouldnt reimburse your money:
- Its been 13 months or more since the fraudulent activity happened on your card.
- Your card provider can prove you authorised the transaction.
- You acted fraudulently like pretending a payment wasnt you when actually you know it was.
- You didnt protect your card details, PIN or password for example writing your PIN down on some paper that lives in your wallet with your card.
Find out more in our guide How chargeback and section 75 protection work for your credit and debit card
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Data Minimization For Protection Against Credit Card Fraud
Put simply, the easiest way to prevent credit card fraud and theft is to not accept or store payment card information in the first place. Obviously, when taken literally, this task is much more difficult than it sounds, so its not a realistic course of action for many organizations that rely on digital payments to fuel their operations. However, the thought behind this sentiment suggests a more feasible, pragmatic overall philosophy of data protection: Dont process or store what you dont need. Accept only information that is required to execute transactions and avoid storing any superfluous data that does not add value thats at least equal to the risk of retaining it. That means keeping sensitive data ingestion and storage to an absolute minimum, thereby reducing the amount of payment card information in your cardholder data environment and making it easier to track and secure what you do possess.
Create A Procedure For Your Business To Protect Against Fraud
An easy way to manage credit card fraud is to make a procedure for your employees to follow when they accept card payments. By creating a procedure, you are making a habit of fighting credit card fraud.
- Check your customers ID with every credit card purchase. When asking for your customers identification, remember that you must be in accordance with the following rule:A merchant may request cardholder identification in a face-to-face environment. If the name on the identification does not match the name on the card, the merchant may decide whether to accept the card. If the cardholder does not have or is unwilling to present cardholder identification, the merchant must honor the card.
- Check the credit card. Make sure there isnt obvious tampering or damage to the credit card. This may indicate a stolen credit card.
- Use Address Verification Service to confirm the cardholders billing address with the card issuer. If for any reason the billing address fails or does not match up with what the card issuer has on file, you can choose to decline the card.
- Look at the receipt and review it against the card. You may see some differences that throw up a red flag. Compare the cardholders name, last four digits of the account number, and signature on the card to those on the transaction receipt.
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Virtual Or Disposable Credit Cards: They Do Exist
Virtual or disposable credit cards add another layer of protection to your day-to-day buying of products online. Essentially, these virtual card providers let you create fake credit cards to use when purchasing items. Its a real credit card number and merchants can charge it like normal, but they never get your real credit card information. This keeps your personal information away from online merchants that may be untrustworthy and limits your financial risk if your virtual card is ever stolen. Most virtual cards let you create a prepaid card , so that even if the virtual card is compromised, it would only be for the amount the user put onto the card. Hows that for helping curtail credit card fraud?
Ways To Protect Your Credit Card Online
Let your fingers do the clicking, and you can have everything from a new outfit to groceries delivered without ever leaving the couch. It sounds convenient, and it is. Just keep in mind that hackers are waiting to grab your personal information and send themselves a nice new gift, too. Fortunately, there are simple solutions you can use to protect yourself and keep your credit card details from getting stolen online.
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How To Prevent Credit Card Fraud With Obfuscation
Obfuscation is a method of securing sensitive data by altering or masking the data so it is unreadable without the aid of protected keys or other additional information. Popular data protection technologies that offer obfuscation are tokenization and encryption. Encryption works by using a protected key to encrypt the data, applying a code to it that changes the original information into what appears to be random characters. Tokenization exchanges the sensitive data for a randomly generated placeholder called a token and stores the original information in a secure cloud offsite. Encryption can be reversed by applying the key to decrypt the data, whereas tokenization cant be reversed by an outside party, per se, only exchanged for the original data by a user with the proper identification and credentials.
In effect, breached systems that contain encrypted or tokenized data prevent credit card fraud and stop hackers from stealing sensitive data by rendering the data unreadable and therefore worthless, providing an additional layer of protection in the event of a breach. Again, cybercriminals cannot commit credit card fraud if they cant access the data required in order to do it.
Network Segmentation For Credit Card Fraud Protection
Network segmentation is another fraud-prevention measure that at first might sound like a bit of an oversimplification. Identifying all of the credit card information in your organizations internal systems and ensuring that it is sequestered to one part of your network can be difficult and expensive due to the cost of monitoring and maintaining secure systems and other hardware. But despite its costliness, this method is also extremely effective. Like data minimization, network segmentation protects against credit card fraud and theft by removing data from the equation and reducing risk as much as possible. This mitigates the exposure of your sensitive data by allowing it to be stored and accessed in only one place, effectively minimizing your attack surface.
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What To Do If You Fall Victim To Business Credit Card Fraud
Its imperative that you report credit card fraud right away if you suspect someone has stolen your credit card or you notice suspicious activity on your account. Contact your credit card company so it can cancel the card, investigate the activity to verify if fraud has occurred, and issue you with a new card.
Regardless of the value of unauthorized charges, U.S. federal law states that the account holder is only liable for $50 in the case of credit card fraud. Many credit card companies also have zero liability policies. This means that you will not be responsible for fraudulent charges on your account.
Once you have reported the issue to the credit card company, file a local police report and contact the Federal Trade Commission to submit a complaint. You can also set up a fraud alert and get a copy of your business credit report to review by contacting a credit bureau.
Finally, update any security information that could have been compromised, including PINs and passwords, to reduce the risk of fraud occurring again in the future.