Card-Present Fraud

Ever get a call from your credit card company asking if you bought something like water skis in Kansas for $500 recently? If so, you are not alone, as someone probably stole your credit card information and created a fake card using your name.

Card-present fraud means a thief purchased something in person, but despite all efforts to prevent it, the card was either stolen or fake. You would think it would be easier to prevent card-present fraud than card-not-present fraud, but...it still happens.

Several steps can be taken by the merchant to try and avoid being ripped off. First, he or she should look for a holographic image, or holographic magnetic strip. One can also ask for identification if things look suspicious. Sometimes, the magnetic strip isn't readable, which is a major clue that something's rotten in the state of Denmark.

If someone is buying and selling a lot of stuff and doesn’t seem to care about the price, that’s another tip-off. And if you can keep a secret, credit card companies use different numbers to start every customer account number. For MasterCard, account numbers begin with a 5, Discover 6, American Express 34 or 37, and Visa 4. Also, the last four numbers of an account are also placed somewhere else on the card.

The use of card-present transactions has gotten a lot safer for merchants since the use of microchip technology (EMV). So far, they have made it nearly impossible for thieves to use a card fraudulently, but thieves will most likely find a way.

But in card-present fraud, it’s the credit card company left holding the bag, not the consumer or the merchant.