Credit Card Fraud Prevention for Businesses

There are a few ways in which a small business could become the victim of credit card fraud: they might have their corporate credit information stolen and used fraudulently, employees could steal the credit information of customers for their own personal (and illegal) use, or customers could purchase goods and services with credit cards that are not their own. 

All will spell trouble for any company, but especially smaller ones that may not be able to withstand the financial hardships posed by such a breach of security.  However, there are plenty of ways to protect yourself (and your customers) from potential credit card fraud.  Here are just a few that you may want to consider implementing for your small business:

  • Only order from secured vendors.  If you’re like most small businesses, you do a lot of ordering online (office supplies, materials for manufacturing, etc.).  You just can’t beat the prices and expediency.  But you need to make sure that you’re only providing your company’s credit information to vendors that offer security on their websites.  This will help you to avoid fraudulent activity on your accounts.
  • Hide customer information.  When you run customer credit cards, make sure that the information is hidden for their protection (and your own).  This means that the credit card number should not appear in its entirety in your computer system (perhaps only the last four digits) or on receipts.
  • Exercise due diligence.  When customers use credit cards, you should make it your policy to ensure that the person using the card is actually the cardholder.  Always ask for ID (for in-store orders) and instruct your employees to actually verify the name and image on the ID.  You should also check to see if the signatures match.  Always reject cards that do not hold up to this scrutiny and if there is any doubt, simply call the credit card company to confirm that nothing untoward is happening.
  • Operate with suspicion.  If a customer order seems strange, check it out.  Keep an eye out for orders that are unusually large, ship to several addresses, are purchased with multiple cards, are shipping overseas, or even those that list separate shipping and billing addresses. Never process an order that offers incomplete information. Make it a point to require a phone number so that you can call to confirm orders that seem suspicious.  And if you’re not satisfied, you can even go so far as to call the credit card company or simply cancel the order altogether.  Better to lose a potential customer if you’re wrong than to face a lawsuit because you did nothing (despite warning signs of fraud).
  • Install fraud prevention.  If you don’t trust your employees (you have caught them stealing in the past, for example), then find ways to prevent such activity.  State your policies concerning the use of credit cards so that customers know if an employee is doing something shady (like writing down their card number).  Stop them from seeing sensitive information in the computer by encrypting it upon entry, and think about placing hidden cameras in your office to catch them in the act.'


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