Prepaid Debit Card Fraud
There is a new fraud tactic that takes advantage of a loophole in the authentication of debit card processing. First, the thieves steal Mastercard Prepaid Debit cards from unsuspecting businesses. These cards are not highly guarded as they are considered worthless until they are purchased. They then seek out small, often locally owned businesses with older POS systems. Then they use the cards when checking out, which generates an error code. After, the thief asks to enter a pin instead, even though the pin is also fake. When the transaction is forced, older terminals will accept any number entered. The fraudulent transaction goes through and the merchant will later receive the chargeback. The cashier often does an offline transaction which bypasses the networks verification rather than calling to verify the card. This is a case of customer service needing to use their due diligence rather than trying to keep the customer happy. A call to verify the transaction takes a few minutes, but can help you to avoid costly chargebacks. Not only are chargebacks expensive but they can cost you down the road if you get too many and risk being moved into the “high risk” category of credit card processing.
At Frontline Processing we are dedicated to the highest level of security for your businesses credit card processing.
We save our merchants 12% or more on their credit card processing fees! 1-866-651-3068