Credit Card Fraud: 4 Ways to Protect your Business

| December 15, 2013

creditcardThere are several difficult aspects to running a company, and unfortunately, many business owners quickly find out that credit card fraud is one of these potential difficulties. Credit card fraud occurs when an individual uses another person’s debit or credit card without obtaining their permission or uses a card that isn’t valid or that has been revoked. Sadly, a company may sell merchandise in these situations but then never receive the money since it wasn’t a valid transaction. This can lead to thousands of dollars in lost merchandise, so it’s imperative to avoid this situation at all costs.

1. Be Weary of Large Overnight Orders

Due to the potential for discovery, fraudsters often have to act quickly when using another person’s credit card. This means that they’ll place large orders and usually ask for overnight shipping. If a company receives this type of order, they should immediately be suspicious and consider taking some of the following additional steps. This is especially true if it’s an international order.

2. Dig Deeper into Different Shipping Addresses

A person arrested and convicted of credit card fraud can face several years in prison, so it’s not likely that they’ll have an item shipped to the credit card holder’s billing address in an attempt to intercept it.

Because of this, a business owner should take additional safety measures if a billing address is different than the requested shipping address. This can sometimes be as simple as asking for a home phone number for both addresses and then running the number through a website such as Whitepages which will try to verify that a specific phone number belongs to a specific address.

3. Request All Information

It’s imperative to get all of a cardholder’s information in order to reduce the chances of fraud. This includes the entire card number, expiration date, verification number off of the back and the complete phone number and address of the cardholder. If a person has all of this information, it means that they’re likely in possession of the card rather than just a stolen number.

Additionally, doing this can prevent potentially damaging wrongful arrests. Some who are charged with credit card fraud end up needing to hire a criminal attorney who can help prove that a suspected case of fraud was nothing more than a case of mistaken identity. While there are several defenses to credit card fraud charges, this defense in particular can mean a very upset former customer who faced legal issues due to a simple mistake.

4. Take Quick Reactive Measures

Sadly, credit card fraud will sometimes happen, and if it does, a business owner should take immediate action. This includes contacting the police and the bank or company that issued the fraudulently-used card. The bank can contact their customer and have them get in touch with the business. At this point, it’s imperative to convince the cardholder to call the police in the city where the merchandise is being shipped to file a report.

Credit card fraud is a huge problem in America, and many business owners end up losing valuable merchandise because of it. Luckily, it isn’t a foregone conclusion that a company will suffer these losses. By simply following the aforementioned tips, a business owner can greatly reduce the chances that they and an unsuspecting credit card holder will be scammed.

Lisa Coleman shares some tips on how a business owner can protect themselves from credit card fraud, particularly with the holiday shopping season in full swing. She recently read about the kind of charges that can accompany such a crime. She obtained some of her information online at to help her complete this piece.

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Category: Consumer Complaints, Credit Card

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