Fraudsters are becoming more and more creative. Following forms of scams have been lately brought to our attention and we want to share them with our customers. Be aware of:

Increased use of counterfeit cards.

This is when a fraudster tries to use a counterfeit card in store that will not tap or swipe because the information on the card is incomplete.

Example scenario: A customer is in-store and they are trying to pay for a high-value item. The card they have presented you with isn’t working. The customer tells you that this happens all the time and that you should just manually enter the card number. Days later you receive a chargeback for the transaction.

What you should do: Always dip, tap or swipe the card for card present transactions. If the card presented does not work, ask the customer for a different card. Do not manually enter the card number.

Requests to transfer funds to a different card to the one used for the initial payment.

This is when a fraudster places an order, then cancels the order and asks to be refunded to a different card, via bank transfer or in cash. They aren’t actually interested in buying your goods, they are trying to get you to transfer money to them.

 Example scenario: A customer makes a booking at your hotel. The customer calls a few days later to cancel the booking and requests for the refund to be credited to a different card number or to a bank account because they have allegedly lost their card. Days later you receive a chargeback for the original transaction.

 What you should to do: Always refund to the card number that the transaction was made on. If the customer states that they have lost their card and you are suspicious of the transaction, advise them to contact their bank and raise a chargeback.

Requests to use a card to conduct third party payments

This is when a fraudster, posing as a genuine customer, asks you to debit their card and then transfer the funds to a third party. They aren’t actually interested in buying your goods, but are trying to get you to transfer money to them.

Example scenario: An overseas customer calls and places a large order of heavy items to be shipped overseas and requests shipment be made through their preferred shipping agent. They request you to debit their credit card for the cost of the shipping and then transfer the funds to the shipping company via wire or bank transfer. The shipping container never arrives and you subsequently receive chargebacks for all transactions processed to the customer’s card(s).

What you should do: Never process a transaction to pay for external third-party costs (costs not related to your business).  

It is important that merchants follow our postings on our  Fraud Prevention page, the best way to be “on your toes”!