Please note the liability for card-not-present transactions rests with merchants. The more information you gather to confirm the validity of each transaction helps reduce your risk of fraud, transaction disputes, and chargebacks.
Signs of potential fraud:
- Customer tries to distract or rush you during a sale
- Customer doesn't ask questions or refuses free delivery for major purchases
- Customer makes multiple orders or frequent purchases
- Customer presents multiple cards
- Customer purchases expensive or bulk items
- Customer cancels an order and requests a refund to something other than the original card
- Address can't be verified through the Address Verification Service
- Customer requests an urgent delivery
- Repeat customer uses different delivery addresses
- Shipping destination is in a known crime area
- Shipping destination is a P.O. box or other mail drop business
- Shipping destination is a foreign address
- Customer uses an email address from a free email service provider
- Customer calls using a text-to-voice relay service
If a customer makes a commotion during a sale or tries to draw your attention to something other than the current transaction, the customer may be trying to distract or rush you so you don't properly authorize the transaction.
If a customer doesn't ask questions about expensive items, such as televisions or heavy appliances, or a customer refuses free delivery of heavy items, that may indicate fraudulent activity particularly when other signs of fraud are present.
Watch for customers who order the same item multiple times or make multiple purchases on the same card in a short period of time, which may indicate the person is trying to use a counterfeit or stolen card before the card is reported to the financial institution.
Customers who present multiple cards may be using counterfeit cards. Look for similarities between all cards. For example, the first 12 digits of each card's account number may be the same, or the delivery addresses provided for all cards are the same even though the account numbers on all cards are different.
Watch for customers who purchase expensive items, more items than are usual for your store, an unusual quantity of the same item, or a lot of merchandise without concern for stye, size, color, or price.
Watch for customers who cancel an order that was originally purchased with a card and ask you to refund the money to something other than the original card, such as a different card, money order, money transfer, or cash. Refunds must be issued to the card that was used for the original transaction.
If you can't verify the cardholder's billing address through the Address Verification Service, you may want to decline orders for shipment. In general, avoid shipping to an address that is not the billing address on an account. If you follow this guideline, you can also prevent chargebacks.
Some legitimate customers need merchandise delivered overnight, but urgent or overnight orders may be questionable particularly when other signs of potential fraud are present.
Watch for repeat customers who order items that are shipped to different addresses over time. Although some customers legitimately need items shipped to different locations for business or personal reasons, this is something to consider particularly when other signs of fraud are present.
Be aware of known crime hotspots in your particular state or the destination of the majority of your shipments. If you ship merchandise to known crime areas, check those transactions for other signs of potential fraud.
People can hide their identities when using P.O. boxes and other mail drop businesses. People can also disguise mail drop locations by entering a box number as a suite number in their shipping address. Although you shouldn't necessarily avoid completing and shipping orders to actual mail drop locations, this is something to consider when other signs of potential fraud are present.
International orders account for a significant amount of fraud outside the United States. High-risk areas include Asia, the Middle East, and Africa. The Address Verification Service does not verify international addresses; therefore, consider the risk associated with a foreign transaction before completing the sale.
People can use free email services, such as Gmail and Yahoo! Mail, to hide their identities. Although this shouldn't prevent you from completing orders that are associated with free email services, this is something to consider when other signs of potential fraud are present.
People who are deaf or hard of hearing use voice relay services to communicate over a telephone. Unfortunately, some people also use relay services to purchase items with stolen or fake credit cards. If you accept orders via telephone from the general public, you must also accept orders from people who legitimately use relay services. Verify orders via relay calls as you would verify any other phone order: verify the credit card is valid and that the caller is authorized to use the credit card. Although you shouldn't decline orders from callers just because they use relay services, you may consider declining such an order when other signs of potential fraud are present.