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The possibility of credit card fraud constantly haunts credit card companies and businesses that accept card payments. The challenge is worse for e-commerce website owners and mail order companies where the credit card information is provided by someone who may or may not be the legitimate card holder. Brick-and-mortar store businesses, swipe cards through POS terminals and the customer is available during the transaction. Though this does not eradicate the possibility of getting conned, it does lower it to some extent.

According to the Javelin Strategy & Research, “Identity Fraud Survey Report,” February 2010, the number of U.S. identity theft victims rose 12% in 2009 and the annual fraud amount equaled $48 billion. Credit and debit card fraud is the No.1 fear of Americans already weighed down by the global financial crisis. (Source: Unisys Security Index: United States, March 2009).

In some cases, bank issuing the card provides some insurance for a merchant’s loss if the business has stringently adhered to all of the bank’s credit card processing regulations. In spite of that, the business still has charge backs to deal with. Credit card processing services implement fraud security measures to prevent fraud but you must also make an effort to reduce the risk of credit card fraud. Here are some tips:

Assess orders for full information

Do not allow purchases if all the mandatory fields in the form are not filled by the buyer. An address authentication via the credit card processing service’s AVS (Address Verification System) service is helpful as most dubious transactions don’t pass this test.

Confirm billing and delivery address

Be suspicious of orders with different shipping and billing addresses. When an existing client does this as a norm, it isn’t worrying. Otherwise, call the customer and confirm. It doesn’t take much time and spares you from future trouble.

Confirm addresses from websites

Confirm the addresses and contact numbers of clientele using online people search websites such as anywho.com, whitepages.com, and others.

Be suspicious of free email ids

Most credit or debit card scammers rely on free email accounts like Hotmail, Gmail, Yahoo, etc. Though these email accounts are also popular with authentic clients,.

Save every detail of the purchase

Store the IP address of customers when they are browsing your e-commerce website or making a purchase. Also record the date and time of the visit, and phone conversation particulars if any. Add the caller ID and any other particulars to the order details. If you do get entangled in a credit card fraud case, this data will prove useful.

Be wary of new clients placing orders of high amount

If a new customer places a large first order, it’s suspicious. If they also ask for overnight delivery services, you should call the customer and make sure she indeed placed the order.

Get the CVV number when placing the order

The purchase order form should ask buyers to enter the Card Verification Value (CVV) number that is printed on the rear of credit cards. Your billing application should store this number and pass it to the credit card processor for confirmation. This reduces the possibility of fraud as criminals typically only have the credit card number to go with.

Caution and observance of processing rules do not eradicate credit card scam but are definitely successful in alleviating it. Follow the above mentioned strategies to protect your business and your clients. Daljeet Sidhu is the author of this article