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Fraud Prevention FAQs
1. How can I prevent fraud?
2. How can I prevent Internet, Mail-Order (MO) and Telephone-Order (TO) fraud?
3. Why should I require CID on my Web site?
4. Why should I require a signature when delivering mail or telephone orders?
5. Why is data security so important and how can I protect my business and customers from
hacking attacks?
6. Where can I report suspected merchant fraud?
7. Where can I meet other merchants that may have the same Card Not Present (CNP) fraud
concerns that I have?
8. What are some signs of suspicious behavior?
9. What do I do if I suspect a Card is fraudulent in a Card Present situation?
10. What are some tools offered by Discover
ฎ
Network to help prevent fraud?
1. How can I prevent fraud?
There isn't a single simple solution or tool to preventing fraud. It takes an assortment of many tools
to prevent fraud. The best protection comes from knowledge and understanding of the latest tools
and trends impacting the marketplace. Discover Network offers its merchants numerous tools to
assist in the fight against fraud. Reading through the FAQs listed below will help you determine
what your business needs to do to reduce your fraud risk. Awareness is the first step towards
fighting fraud!
2. How can I prevent Internet, Mail-Order (MO) and Telephone-Order (TO) fraud?
Here are some guidelines for preventing Internet and MO/TO fraud:
Request Cardholders for the following information during the order taking process:
Cardholder Name, exactly how their name appears on their Discover Network issued card
Card Account Number is at least 16 digits
Card Expiration Date, four-digit number MM/YY
CID (Card Identification Data), the three-digit number located on the back of the card in
the signature panel
Card billing address along with the ship-to address (when necessary)
Home, business or other telephone number where the cardholder can be reached
For each transaction, be sure to:
Request and validate the Card Identification Data (CID) (the three-digit code on the back of
the card in the signature panel). The CID can be submitted in the electronic authorization
request or can be used when calling our authorization center
Verify the customer's billing address, either electronically or by our automated phone
system (Address Verification System - AVS)
Check your delivery service contract for who is responsible for merchandise not delivered
Get a signature for each delivery
Keep all delivery records
All declines are final. Do not force through any sales for which you have received any
declined response to your authorization request
If the sale is on a credit card, do not refund in cash or by check. Refund sales on the same
card account that the purchase was made on
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Include your common DBA and customer service number on the cardholders transaction
statement
Clearly communicate any and all delivery charges, restocking or other fees
Clearly explain any return policies and offer documentation of this policy with each sale
When working on a chargeback, document efforts to satisfy the customer
Respond to all chargebacks, even the small ones (remember, this is your customer)
Duplicate charges, or installment plans, unless otherwise stated, require an authorization
for each sale
3. Why should I require CID on my Web site?
In addition to the requirements in the Merchant Operating Regulations, Section 5.1.1, CID provides
the assurance that the card was in the possession of the cardholder at the time of purchase. It is
the best defense against online fraud.
4. Why should I require a signature when delivering mail or telephone orders?
In addition to the requirements in the Merchant Operating Regulations, Section 5.1.5, requiring a
signature from the cardholder will give proof that the proper person received the shipment. The
signature may be verified in the event of a chargeback situation.
5. Why is data security so important and how can I protect my business and customers from
hacking attacks?
In today's world, credit card information is being illegally obtained in many different ways. One of
the primary sources for obtaining this information is by hacking vulnerable businesses lacking
proper data security. The best way to protect yourself is to develop a solid information security
strategy for your business. Some basics include the highest and most technologically advanced
Secure Sockets Layer (SSL), Firewalls, cryptography tools and anti-virus software. The rule with
data security is that you cannot be too careful. The best way to fight this growing epidemic is to
work with a highly regarded company that specializes in data security. Learn more about our Data
Security guidelines and our DISC program by visiting
www.DiscoverNetwork.com.
6. Where can I report suspected merchant fraud?
Please contact our Merchant Fraud Prevention Department at 800-347-3083.
7. Where can I meet other merchants that may have the same Card Not Present (CNP) fraud
concerns that I have?
The Merchant Risk Council is one organization of this type.
8. What are some signs of suspicious behavior?
Here are some tips to help you detect possible fraudulent situations:
Customer Behaviors
Makes random purchases without paying attention to size, value or price
Presents you with a credit card taken from a pocket instead of a wallet
When asked, claims to have left photo identification at home or in the car
Arrives at or about closing time and tries to hurry you through the sale
Purchases a large item and refuses delivery
Displays no interest in the warranty on expensive items
Is overly slow and deliberate when signing the sales draft, perhaps because the signature is
being forged
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Card Characteristics:
Card is missing the stylized "D" character
Seems counterfeited or it seems as though the information (i.e. expiration date, hologram,
account number, embossed name etc.) thereon is altered
The signatures on the card and the sales draft are different
The validation date has expired
Security features have been tampered with
9. What do I do if I suspect a card is fraudulent in a Card Present situation?
If you suspect fraud: Call 1-800-347-1111 and ask for a Code 10 authorization if you have any
reason to suspect the transaction or are suspicious of the customer.
10. What are some tools offered by Discover
ฎ
Network to help prevent fraud?
There are many fraud prevention tools offered to Discover Network Merchants. These tools can be
ordered by clicking on an item below or by calling 1-800-347-2000, Option 3. Here are a few of
the Fraud Prevention tools available:
Fraud Awareness Training Guide (#12797) A seventeen page fraud awareness training
guide covering security and fraud prevention and accepting Discover Network card
transactions.
Card ID Features - All Cards (#33844) -A helpful two-sided slick that provides card
identification features for the four major credit card types.
Other Important Reminders:
Your approval number does not eliminate the possibility of a fraudulent sale
You are the first line of defense against fraud
Discover Network is here to assist you in the fight against fraud