2018 OCCUPATIONAL FRAUD AND ABUSE REPORT

The 2018 Report to the Nations by the Association of Certified Fraud Examiners (ACFE) is the most comprehensive and widely quoted source of occupational fraud data in the world. Based on information from real fraud cases as reported by global CFE’s the occupational fraud is a resource for those interested in how occupational fraud is committed, how it is detected, who commits it, and how organizations can protect themselves from it.

Get the report FREE 2018 Fraud Report here. I recommend reading the case studies. The stories and methods may change, but ‘trusted’ employees as perpetrators is common both in the reports any my real life experiences.

Looking for solutions to mitigate employee fraud risk? Call for free consultation.

The Christine Speedy difference. Fraud is growing internally and externally. Learn about tools to help your company mitigate risk. Call 954-942-0483, 9-5 ET.

last 4 digits of card don’t match

How can merchants reduce risk of fraudulent card transactions? One of the most widespread credit card fraud schemes involves magnetic stripe counterfeiting. This scam involves re-encoding a valid account number onto an existing magnetic stripe. One way to prevent fraud at retail locations is to require cashiers check the last 4 digits with your software. We automatically program the last 4 digits as a required field for all retail merchants.  Here is how it works with our host based payment processing technology and a signature capture terminal:

  • Cashier presses the sale button and enters the transaction amount. Other parameters such as an invoice number may also be required.
  • Customer swipes their card and data is immediately encrypted
  • Cashier asks to see the card, checks to see that it is signed, and then enters the last 4 digits of the card in the system.
  • Cashier presses submit and data is sent via secure internet connection to host; host returns message:
  1. approval and a request for signature on terminal; customer signs and presses enter
  2. approval and terminal requests pin number if the technology has determined that this transaction would best go through as a pin debit transaction. Customer presses cancel if he/she wants to enter as a credit transaction and is immediately prompted for signature.
  3. denial and reason
    • If the magnetic stripe does not match the numbers you key in, the terminal will display “Last 4 Digits Do Not Match/Mismatched Digits” and will halt the transaction. (CenPOS will outline the box in red will not let user proceed). To ensure that you didn’t enter the wrong number, try to run the transaction once more. If your terminal displays the same warning, call the Automated Voice Authorization Center and tell the operator that you have a “Code 10” authorization.
    • A request for a “Code 10” authorization tells the operator that a suspicious transaction is taking place. If you can’t speak freely, the operator will read a list of possible problems with the card so you can answer yes or no and avoid alerting the customer. You should attempt to stay on the line and keep the card until the authorization is complete. If the authorization is denied, follow the instructions the operator gives you.
    • If the card is fraudulent, do not attempt to apprehend the card user. If the operator instructs you to retain the card, attempt to do so peacefully. Follow any specific instructions the operator gives, unless they put you at risk.

Any credit card terminal can be programmed to prompt for the last 4 digits. A host based system also allows merchants to change and add security parameters on the fly for all locations.

Is your merchant processor helping you with risk management? For just pennies a day, you can have a host based payment processing solution that will reduce risk regardless of your payment processor, in addition to many other benefits, including cost reduction.

Manually Imprint Credit Cards to Avoid Fraudulent-Transaction Chargebacks

When do you need to take a manual imprint? Why does a key entered face to face transaction occur? If the magnetic strip is bad or if there is a card reader malfunction you won’t be able to get proper swipe. If you put a card present transaction on a card present merchant account, a signature on a receipt is not enough to protect you from a chargeback if the customer disputes the charge. You have to prove that the card was present with a physical imprint to protect yourself in a fraudulent transaction dispute.

If you are unable to take an imprint with an old fashioned imprint machine with metal plate, then get a pen and paper and pass the pen back and forth until you get the imprint.

A power outage or special off site events are additional reasons why you may need to get a card imprint. We send all merchants a metal plate for manual imprinting, and many ask why they ever would need it. The manual imprint is required for all key entered face to face transactions.

How can technology increase protection from card present fraudulent transactions?
CenPOS smart payment engine has many functions to reduce risk. For example, a standard set up might require the cashier to enter the last 4 digits of the credit card. Fake  credit cards are a major crime problem in the US. Most fake cards have a valid credit card number on the front, but the number won’t match the magnetic strip information on the back. The logic of CenPOS will protect you from this type of attempted credit card fraud.

When a card is declined for a last 4 digits mismatch NEVER attempt to put through the transaction by overrides or any other method. Even if you get the transaction through, you will lose any chargeback fight because there will be a record of the failed attempt with the reason code for mismatch.

This is just one example of many features CenPOS has built in to protect merchants from both internal and external fraud. Contact Christine Speedy at 954-942-0483 for additional information on CenPOS technology and other merchant services.