Tag: fraud

There are hundreds of accounts of fraudsters using various scam methods for credit card stealing, making fraudulent purchases or selling goods that never arrive at their intended destination. So much so that small businesses were literally forced to incorporate those fraud transactions into cost of doing their business online. Here are a few tips that should help a small business sustain some of the most often tried transactions – purchase with fraudulent credit cards. Some small businesses have this reason alone to choose more expensive credit card processor, like PayPal,  in order to not to deal with fraud themselves, potentially loosing thousands of dollars in revenue. These simple steps may help recover that money given that small business processes credit cards through its own merchant account.

1. Verify shipping vs. billing address. Some web sites even refuse to ship to an address that is different from billing, but that is really up to the business owner. If you sell something that could potentially be a gift, so that one relative can order it for another – pass it on, but if you sell something that people mostly order for themselves, like gadgets or novelties, then shipping address way off from billing might suggest something fishy.

2. Ask yourself – does the order make sense? If you are selling expensive merchandise that people are most likely to buy once in a while – would the order for five items make sense? Call the billing phone number to verify the purchase – it will cost you 2 minutes, but potentially can save you hundreds of dollars.

3. Have the payment cleared yet? Institute shipping and handling policies that will cover your bases while you wait for payment to clear. Sometimes it may take a day or two for payment to go through all the hoops of your payment system, be patient and wait out the whole thing. It may bounce off for a number of reasons, first of which is stolen credit card.

4. Verify the IP address‘s geographic location vs. both shipping and billing. It sounds a bit nerdy at first, but any online shopping cart can be tweaked to display originating IP address along with the order information. The task is to see if the IP address belongs to the same region as the two addresses. An order originating from Eastern Europe’s IP address that has billing address in Connecticut and shipping destination in California is hardly legit. In some cases you won’t be able to tell if the IP address is or is not located where the billing or shipping addresses are, in these cases just move on to #5.

5. Never hesitate to call the bank that have issued credit card. Have your clients enter the 800 number on the back of the credit card along with their billing information. In any doubt – call the bank and have them verify that name, billing and shipping addresses are legit. Some banks even have that option on their initial menu.