How To Avoid Credit Card Processing Scams ? What You Can Do

One of the main reasons for these frauds is the credit card processing scams. Credit card payment processing companies have noticed a significant growth of such scams among small or medium-sized businesses as compared to large industries. And, if these SMBs do not have sufficient resources to handle them, the impact of scams are much more significant. A major retail can bare the impact of the loss of a couple of dollars but it is not the case with small or medium-sized businesses.

 

 

As you can see, credit card scams range from petty theft to calculated criminal activity. Some deceptive practices require the unwitting participation of consumers. There might be sophisticated technology or there could be a compelling pitch, which is designed to fool a victim.

 

Here are some credit card scams — and some tips to avoid them:

 

 

When a customer’s card doesn’t go through, merchants can actually force-authorize the card to complete the transaction. Some scammers know this, and have taken advantage of the fact. They’ll say something like, “Oh, sorry, this happens all the time,” and offer a code to override the denial. If the code is fraudulent, and the payment goes through, the business is on the hook for the fraud amount, and will be subject to costly chargebacks and fines.

 

To play it safe, force authorizations should always be taken with care. Make it a point to always call the issuing bank to get an authorization code.

 

If the order placed by a customer is much larger than what merchant processes, be careful, as wire scam may occur. It is a scam where customer overpays for the orders he/she has placed and asks the merchant to wire the exceeding amount to a third party. This third party is responsible for picking up ordered product from the merchant and delivering it to the customer who ordered it. To avoid wired scam, always remember two things:

 

1) Never accept excess money to be wired to a third party, no matter what reason may customer give.

2) Doing so can cost the merchant a fine and a fee for conducting fraudulent transactions.

 

 

This is the most common scam and according to a recent study, 13% of the gift card frauds are by store employees and usually, they steal from already load cards. There are a range of ways for scammers to profit off of gift cards. Two of the most common are skimming the numbers to create counterfeit cards, and returning stolen goods in exchange for gift cards. If you’re a smaller retailer, the second, and even the first of these may not be much of an issue. Still, offering gift cards is a convenient service for your customers, and with the proper security measures, you can do it safely. Look into digital gift card providers like gyft that may suit your needs.

 

 

1) To protect cards from theft and unauthorized use, implement security measures.

2) For all returns, request receipt and ID.

3) If it happens, refund the transaction immediately and do not give away the product.

4) For assistance on any suspicious activity, contact your payment processor’s risk department.

 

Merchant Stronghold provides a payment processor for high risk merchants and has a well-qualified payment processor risk department, which can help you resolve issues with high accuracy and within time. Our experts are available 24*7, 365 days to take any credit card processor query. Just give us a call on +1(888) 622-6875