Education » Articles » Fighting Credit Card Fraud

Fighting Credit Card Fraud

We often provide tips for you that contain suggestions for ways that you can avoid fraud and scams. Did you know that combating fraud is a challenge for businesses in addition to consumers? Many merchants are implementing ways to combat these crimes and prevent these scams from being successful. Don’t be alarmed if you encounter any of these fraud prevention techniques. In fact, they're in place to help you, not harm you.

At a Store

Asking to See Your Card.

A merchant may ask to see your card for multiple reasons:

1. Match the numbers.
   Checking to see if the embossed number on the card matches the four digits of the account number displayed on the terminal. This ensures that the magnetic coding on the strip matches the number on the front of the card.
2. Check the signature.
   Making sure that the signature on the card matches the one the transaction receipt.
3. Checking to see if the card looks fake.
   Many merchants train their employees to look for signs that a card is a fake. Often, by simply looking at a card, they can see if it's a forgery.

At a Gas Station

Asking for Your Zip Code at the Pump.

1. Zip Code Verification
   This attempts to stop stolen credit card use. Asking for your zip code allows the merchant to verify the billing information you provide with the billing information on record for that card number.

Online Transactions

Since you're making transactions without being able to hand the card to the merchant, card companies have developed a few fraud prevention measures for online and phone purchases.

1. Card Verification Value (CVV)
   Card Verification Values are security codes of 3 or 4 extra digits imprinted on the back of your card, which are not embedded or encrypted in the magnetic strip. Since most fraudulent transactions result from stolen card numbers rather than the actual theft of the card, a customer that supplies this number is much more likely to be in possession of the credit card.
2. Authorization
   A merchant puts an authorization for a transaction on your card prior to the payment going through. If a transaction is authorized by the bank or card company, it indicates that the card hasn't been reported stolen or lost, and that the credit limit has not been exceeded. If someone else is using the credit card number illegally, the card holder has a right to dispute the 'approved' charges.

More College Life Articles »