Online fraud is possibly different from the fraud that occurs in traditional businesses as you are uncertain that the person, you’re selling to is a real customer or a fraud.Some fraudsters have discovered various sophisticated methods than just trying to make purchases on a stolen card. An e-commerce credit card fraud occurs when the information is held loose from the side of a cardholder or someone steals the data of the card. By building up an enormous amount of information online there is a great risk of data breach and hacking.So, whenever a fraudster tries to steal card information, he attempts to do that from a vulnerable or less informative person there is. The technological advancement has exposed to a lot of data as maximum people are now online and try to do transactions on an online marketplace.
Though there may be security, but there always is an opportunity for fraud. Fraudsters find one or the other way to rip you off your money.
Types of Credit Card Frauds:
- Overpayments: This is also called as stolen card fraud. The fraudsters present themselves as requiring the services from a third-party. Then he offers to pay the seller the cost, extra sum and often, an additional convenience for accommodating the request.
- Account Takeover: When a credit cardholder innocently and unwittingly gives personal information (such as a home address, mother’s maiden name, etc.) to a potential fraudster, who contacts the cardholder’s bank, reports a lost card on behalf of the cardholder and obtains a new card in the victim’s name.
- Multiple Imprints: When a single transaction is recorded multiple times on credit card imprint machines.
- Collusive Merchants: When a merchant’s employee works with the fraudster to defraud banks.
- CNP (Card Not Present) Fraud: If someone knows the expiry date and account number of your card, they can commit CNP fraud against you. This can be done through a phone, email or Internet. It essentially means that somebody uses your card without having physical possession of it.
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While companies often spend untold sums of money on the products, they should spend some amount on fraud risk management, and delegate the fraud prevention solution to an external party to recognize security issues, threats, and deliver best practices. If you want to stay in business, then protect cardholder data by training your employees as well on important security issues and threats – it is very simple.