Credit Card Processing Experts - Credit Card Processing: 5 Credit Card Scams That Victimize Merchants -

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Credit Card Processing: 5 Credit Card Scams That Victimize Merchants

by Trisha Echols Merchants thrive on credit card payments. It's the bread-and- butter of their existence. Honest customers who purchase goods with genuine credit cards make merchants happy. Sadly, there are also unscrupulous people out there who ruin merchants' business by using a number of bogus credit cards. These dishonest customers resort to all kinds of frauds. Consider this harrowing but true incident: John sells talking wrist-watches through his online store. One day, he received two orders from a customer named Paul DeMitt in Memphis, using a free mail account. The order logged in the IP address of the PC that this customer at the time he made the order. Since John always double-checks orders, he went to WhoIs to find out the ip address of the customer. The results showed that it belonged to a dial up network--- in Nigeria. Still harboring suspicions, John called up the card issuing company and verified the credit card number given by Mr. DeMitt. It turned out that the credit card was did not belong to this customer. So John didn't process the order. He learned later on that several merchants had already been outwittingly victimized by this same customer ! Had John processed the order, he too might have incurred losses. While having credit card processing service helps, merchants still need to be vigilant at all times. Below are some of the credit card scams : <ol><li>STOLEN CARDS A legitimate card holder lost her credit card. Somebody found it and then started using it to buy goods. When the huge bills arrive, the real card holder refutes the charges. The merchant is then charged with costly chargeback fees plus the total purchase amount. He ends up losing his good and his money. To prevent individuals from using stolent cards, merchants should use AVS service. If not, he can discreetly ask the customer. The merchant can turn down the transaction if he discovers anything amiss. </li><li>SKIMMING A genuine card holder enters the restaurant for some meals and hands over his credit card to the waiter. Unknown to the the customer and to the restaurant owner, the waiter has a handy device where he can discreetly swipe the card and capture its contents. This waiter can then sell the information to unscrupulous credit card gangs or make a bogus card for himself using the captured data. The waiter can now use the bogus card to make expensive card transaction. As expected, the bills goes to the real card holder who will refute the many transactions. The merchant is left with huge business loss with this credit card scam. </li><li>FAKE CREDIT CARDS Some enterprising individuals can make credit card forgeries look so real you can not tell the difference with just a cursory glance. Credit card processing service prevents this type of scam from hurting your business. However, you as a merchant is advised to be vigilant at all times and verify the card authenticity. </li><li>TRIANGULATION Involves unscrupulous individuals usually with fake merchant's site that could victimize you-- a legitimate merchant. This is how it works: A legitimate cardholder named Jill stumbles on a merchant's website selling goods at very, very low price. She makes the orders and gives her credit card number. The merchant website owner delivers the goods to Jill, and instructs her to pay not by credit card but by cash through money couriers. Jill obliges. Without her knowing it, this unscrupulous website owner uses her credit card numbers to purchase items in the Internet.( He could be purchasing items from legitimate merchants like you!) He then resells it at an outrageous low price. When Jill receives her credit card bills, she would find several unauthorized purchases. She then contests the charges and wins. That leaves legitimate merchants like you with nothing but huge losses. To protect yourself against this fraud, use the address verification service (AVS). </li><li>CREDIT CARD NUMBER GENERATORS There are some software that could generate credit card numbers. Dishonest customers then use these numbers to make card purchase transactions over the Internet. As a merchant, you can usually defend yourself against this scam by having credit card processing service. Also, ask for the CVV2 or the 3-digit security code of the credit card in conjunction with AVS. If still in doubt, contact the credit card issuing company and verify the account. You can always catch the credit card scam 100% this way. </li></ol>   <ol> ( Trisha Echols currently is a long-time financial consultant with established consultancy offices in Amsterdam, Halifax, Malaysia and other key cities. Her clients belong to the top 500 companies in England and in the United States. Miss Echols is also a business consultant for many credit card processing companies, including <a href="http://www.creditcardprocessingexperts.com/">www.creditcardprocessingexperts.com</a>. She does lectures on strategic business practices and also writes for various magazines on business matters.)<a href="http://www.onlywire.com/submit?u=http://www.creditcardprocessingexperts.com/credit_card_processing_5_credit_card_scams_that_victimize_merchants.html;t=credit%20card%20processing;tags=credit%20card%20processing" target="_blank" title="Add this Article to Onlywire"><img src="http://www.onlywire.com/i/onlywire.ico" alt="" />Add to Onlywire!</a> </ol>

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