How do I prevent fraudulent online credit card transactions?

When you do business online you always need to take extra precaution against fraudulent transactions. Online fraudsters are anonymous and they try to circumvent various types of regular fraud prevention. Does that mean you are better off not accepting credit cards online? No, but you should be more careful deciding which ones you want to accept and which not.

If you wish to accept credit card payments take steps to ensure protection. Make sure that you have a reliable card processor for card authorization services. If you are looking for a new payment processor it’s a good idea to contact a professional in the payment industry. A good payment processor will let you implement fraud prevention tools such as Visa’s Address Verification Service (AVS), Card Verification Value 2 (CVV2), and Verified by Visa. These fraud prevention tools will help you greatly at reducing fraud. However, they are not enough.

Potential fraud signs

Always use common sense when reviewing payments and when in doubt don’t hesitate to ask the customer for more information in order to verify the order, especially if you are selling high priced items.

  • – New customers always have a higher probability of being frausters simply because fraudsters don’t hang around and always need new victims in order to be effective 
  • – Orders that are larger than the usual ones might indicate fraud is involved. Online credit card fraud is quick operation: get as much as you can as quickly as you can. 
  • – Multiple orders of the same product give a fraudster plenty of goods to resell.
  • – Orders with the multiple high prices products due to the high resell value.
  • – Rush shipping with shipping charges no issue, or even higher shipping payments offered. Fraudsters want their products as quickly as possible and they are not afraid to pay for it. Of course they aren’t, because they are not paying with their own credit card.
  • – Shipping to an international destination. A significant number of fraudulent transactions are shipped to fraudulent cardholders outside of the U.S. Visa AVS can’t validate non-U.S., except in Canada and the United Kingdom. This the reason you will see many US cards with non-US shipping addresses.
  • – Transactions with similar account numbers which is especially used when the fraudster uses generator software.
  • – Multiple transactions with a single card in a very short period of time is a sign that a fraudster is “running a card” until it is blocked. Also check if multiple transactions with a single card but different shipping addresses.
  • – Multiple cards used from a single IP. Two card could be possible, but more than one always requires additional checks.

If you want more information you can contact a professional fraud risk consultant.


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