Fraud is one of the fastest-growing businesses in the U.S. Identity theft, financial fraud, and credit card misuse are widespread. Businesses are just as vulnerable to abuse as individuals.
How can business owners avoid becoming victims of credit card fraud? Start by understanding the fraudsters’ methods, then learn to stay a step ahead of them. The following are commonly used methods of credit card fraud:
- Malware attacks: Malware is software that allows hackers access to the victims’ computers. Undetected access allows them to steal passwords, bank information, and credit card numbers. Frequently updated anti-virus software keeps these attackers at bay.
- Phishing and SMSishing: You’ve heard the warnings again and again: never open a file you don’t recognize. Phishers pose as genuine businesses, such as banks or social networking sites. They send official looking emails and SMS’s that prompt recipients to confirm passwords and account information. Avoid being scammed by deleting suspicious-looking emails without opening them.
- Credit card skimming: Skimmers steal credit card information from legitimate transactions. Unsuspecting customers hand their credit card to a dishonest merchant, who uses a small skimmer device to read and store the credit card’s numbers. The merchant then uses the information to purchase something, or sells the information to others. Skimming is difficult to spot and avoid, but business owners should carefully examine their monthly credit card statements for suspicious charges.
- Site cloning: Fraudsters might clone an entire website, or just the order form page of a merchant site. Victims enter all their information, including name, address, and credit card number, thinking they are making a valid purchase. They don’t realize they are directing their I.D. to a thief.
- False merchant sites: False sites easily dupe customers into providing their credit card information. They simply advertise their wares at ridiculously low prices, then request full credit card details from those who want to access the site. The take-home message? Do not freely provide your credit card number, unless you are certain you are buying something legitimate.
- Credit card generators: Using mathematical algorithms, this software imitates patterns of existing credit card numbers to create thousands of new credit card numbers. Many are actually valid numbers and expiration dates. Again, a meticulous review of credit card statements will reveal whether a generator, or anyone else, has misused your credit card number.