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Don’t Be a Target: Follow These 3 Simple Steps to Protect Yourself from Fraud this Holiday Season

Ray Moorman

The holidays are here and it is game time for merchants. Shoppers are out in full force, each with a list they’ve checked twice. However, even the most wonderful time of the year has a serious downside for retailers: fraud.

High volume, high traffic times like the holidays give criminals a golden opportunity to commit fraud undetected. But there are ways merchants can reduce the risk. Here are three easy steps store owners can take to help prevent fraud this holiday season:

1. Check customer information at checkout

It’s a hectic time to be running a cash register and employees can easily drop their guard when it comes to fraud. Retailers can avert these situations by reminding employees that fraud prevention is a necessary part of the transaction process that cannot be rushed or skipped.

  • Asking for ID: Customers are not always happy to dig out their ID, but confirming their name is the same one on the card is a good way to help prevent fraud. (1)
  • Checking the card: Employees should always examine the payment card before the transaction is complete. Major credit cards like VISA and MasterCard have several distinct attributes people should look for, including placement and design of holograms, signature strips and bank identification numbers.

2. Watch for strange behavior in the store

Criminals intent on defrauding businesses often follow similar patterns that store owners and employees may recognize.

  • Buying large quantities of the same item: If someone tries to check out an unusually large number of the same product with little regard for cost or color, there is a good chance that customer is using a stolen credit card.
  • Expressing no interest in free delivery for large items: Fraudsters purchasing products in store typically do not want their items shipped because it may help authorities track them down.
  • Hurrying the transaction: When people try to rush sales clerks through a transaction or try to distract them, it represents another big warning sign.
  • Shopping at the open or close of the store: People often commit small business fraud just after the store opens or just before it closes, hoping the staff will be distracted by other tasks.
  • Coming back for more: When people buy several items and leave, only to return to buy more in a short time, this may be a sign they are stockpiling fraudulent purchases for resale.

 3. Look for warning signs with online transactions

Businesses that allow online transactions are in a tricky position because transactions are processed without the benefit of examining the payment card itself. Despite this, online merchants should know the warning signs of a person trying to commit fraud.

  • Be suspicious when addresses do not match: Even though some transactions may be legitimate – like gift purchases, for instance – large orders where the billing and shipping addresses differ are a possible sign of fraud. This possibility is even more likely when the customer asks for expedited shipping. When your employee identifies these warning signs, it’s a good idea to call the customer to verify the purchase. (2)
  • Stay vigilant for suspicious email addresses: Sometimes a suspicious looking email address can alert businesses to fraud. For instance, addresses that contain a jumble of letters and numbers, rather than a name, are a red flag.

4. Train employees on how to report fraud

When an employee suspects a customer is trying to commit fraud at checkout, they should calmly contact the appropriate person to report suspected fraud without alarming the customer. Due to safety precautions, no one on your staff should try to confront the customer or prevent him or her from leaving the store. 

Fraud is an ever-present risk for retailers, especially during the holidays, but you can stop many attempts simply by watching customer behavior and checking payment cards. Remind your staff how to recognize the signs and report suspicious activity. This is a great first step toward a prosperous, theft-free new year.

  1.       http://credit-card-processing-review.toptenreviews.com/credit-card-processing-how-businesses-can-protect-themselves-from-fraud.html
  2.       http://smallbiztrends.com/2013/09/tips-prevent-online-credit-card-fraud.html

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