4 Glaring Signs of Credit Card Fraud in Your Business

Online businesses are the most frequent victims of credit card fraud and identity theft. They are the ones that end up bearing the harshest consequences of online fraud that includes chargebacks, fines, penalties, in addition to a loss of reputation and loyal customers. All in all, reports suggest a loss of over 31 billion dollars to businesses due to card fraud during the previous year.

The battle against fraud is a serious one and business need to be proactive about it if they need to curb their losses. Fortunately, there are some obvious signs that can alert an online merchant to fraudulent activity. It is important to be vigilant about these signs if you want to secure your business operations from unwanted regulatory scrutiny or cashback requests. Not to mention the huge revenue boost you can receive by implementing a strict policy to deter credit card frauds.

So here are 4 things that you must do in order to prevent credit card fraud happening to you.

1. Unusually Large Orders

No sane customer orders 50 or more of the same item or merchandise from an online store. When a person is shopping online on stolen cards or credentials they usually tend to benefit as much as they can. It is always useful to check the amount of the merchandise ordered by the customer. Moreover, also check to see if any of the orders are for more than the average amount of orders that are common for your business. It is obvious for criminals to make high-value purchases from stolen credit cards.

2. Suspicious Delivery Requirements

Most sensible victims of card theft tend to file a report with the authorities and tend to block their cards as soon as possible. In other circumstances where only a person’s credentials (card number, PIN, security code etc.) have been stolen, banks and victims tend to notice any suspicious activities through their bank statements and eventually move to block their cards as soon as possible. Therefore, an identity thief may want to benefit from the card’s utility at the earliest.

Under such circumstances, they tend to place a rush on deliveries and have items delivered overnight. Detecting and identifying such instances of credit card fraud is easier. Online shopping businesses should be cautious of such deliveries and verify the order beforehand in order to avoid an embarrassing situation that might even let them lose money and their sold item at the same time.

3. Different Billing and Shipping Addresses

Different billing and shipping addresses may be used in case of gifts. However, this tactic may also be used by scammers to commit credit card fraud. A fraudster may be using the stolen identity’s address to bill them for the order while shipping the merchandise to his/her personal address.

Moreover, a habitual fraudster may be using multiple stolen identities and credit cards to commit fraud. Therefore, online retailers should keep an eye out if a number of credit cards are registered with the same account. In other cases, different credit cards may also be used to make deliveries to the same address. For such cases using address verification services from Know Your Customer (KYC) service providers may save your business a lot of trouble.

4. First-Time Customers

New accounts may also be used for fraud at times. Scammers usually look for heedless e-commerce stores to commit fraud. They tend to make fake or disposable e-mail address entirely for the purposes of making fraudulent online purchases.

Credit card fraud is fast becoming a plague for online stores. Bold steps need to be taken to prevent scams and fraudulent activity. This not only involves huge savings for businesses but can also help develop trust amongst customers.