E-Tailers Get 'Fraud Squad' Help

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The Worldwide E-Commerce Fraud Protection Network last week launched its fraud protection Web site, www.merchantfraudsquad.com.


The Web site provides online merchants with advice on how to prevent online fraud, which involves the unauthorized use of credit card numbers and other payment vehicles to purchase goods and services.


The site includes tips for preventing the use of stolen credit cards online; information on secure Web hosting; how to report online crime; information on the use of e-signatures for fraud protection; and consumer advice for shopping safely online, which merchants can feature on their Web sites.


The five tips for preventing stolen credit card use include:


• Obtain real-time authorization from a credit card company, ensuring that a card has not been lost or stolen and is a valid card number.


• Employ address verification systems, which match the billing address provided by the customer with the address provided by the credit card company.


• Use credit card verification codes, which are non-embossed codes that most credit card companies place on their cards.


• Purchase rule-based detection software, which enables merchants to screen each transaction for pre-defined criteria such as billing addresses that do not match, high-dollar transactions or an order for a relatively high number of one item.


• Purchase predictive statistical model software, which gathers data from large databases to create a profile of what typical fraudulent transactions look like.


The Worldwide E-Commerce Fraud Prevention Network is a not-for-profit organization formed by American Express and its coalition partners: Amazon.com, ClearCommerce, Expedia.com, First Data Corp. and Starwood Hotel & Resorts Worldwide.
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