Page 121 - Pay Magazine s2014

volume 7 • fall 2014
pharmacies, big box retailers, and convenience and general merchan- dise stores. In addition to assisting retailers understand and combat fraud, InComm, along with others in the prepaid industry, work with law enforcement, including local, state and federal authorities.
“InComm is passionate about pre- paid and making sure our retail partners and their customers have a good experience with our prod- ucts,” says Skeet Rolling, ITCFL chief operating officer. “To that end, we try to protect the prepaid card business and make sure it’s as se- cure as we can make it, recognizing that people stay up all hours of the night figuring out ways to defeat systems and get money they’re not entitled to.”
Scams and How to
Fight Them
InComm spends significant
effort identifying and establishing how to deal with the five major kinds of prepaid fraud, and now they’re sharing this information with Paybefore readers, so every- one can use these learnings as part of their own anti-fraud efforts— incorporating them in the ways
that are appropriate for their business. The tightly knit prepaid value chain is only as strong as its weakest link.
“By committing to ongoing employee training, retailers can make a significant difference that protects their profits and their customers.”
—Skeet Rolling, ITC Financial Licenses Inc.
• Request and record cus- tomer information if the clerk is suspicious about the transaction.
• Make sure the physical
card is present, an electronic authorization is received,
the customer signs the sales draft and the sales draft is properly recorded/stored so
it can be retrieved, if necessary.
In addition, the store can limit the number of high-dollar prepaid products sold per transaction.
2 Package Tampering
The Setup: The card packaging
is damaged (the original card is replaced), altered (a barcode sticker is added or replaces the original) or just looks suspicious.
The Problem: Fraudsters end up with an activated card and the customer’s card has no value.
1
Method
of Tender
card, only to discover the credit card was lost or stolen, so the transaction wasn’t “authorized” by the rightful credit card holder.
The Problem: If the retailer doesn’t follow correct card acceptance pro- cedures, the retailer may be liable for the transaction through the chargeback process.
How to Fight It: Store clerks
are the front line. Clerks must understand the absolute impor- tance of their role to perform certain functions every time card- based tender is used to buy a prepaid product:
• Verify the embossed card number matches the card number on the receipt.
If fraudsters skimmed a cre- dit card, magnetic stripe data would be re-encoded, and the embossed and encoded numbers wouldn’t match.
• Never override a declined transaction.
The Setup: A retailer accepts a credit card as payment for a prepaid
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