Fraud and risk prevention

Frequently asked questions

• What is the most common source of fraud?

  One of the most common types of fraud is Mail Order/Telephone Order (MOTO) fraud, which contributed to 74% of all fraud cases reported to Moneris in 2023. Taking card details over the phone or by mail and manually entering them poses a high risk for chargeback fraud. If a cardholder disputes a charge completed via MOTO, the business is left with the loss – there is no recourse.

• What are “red flags” for spotting fraud online

  Reviewing transactions is always best practice. Here are some “red flags” to look out for:

  • Unusual transaction amounts in quick succession with similar card numbers.
  • Single address for shipping but different cards for purchasing. 
  • Orders with multiple big-ticket items and expedited or international shipping.
  • Insistence on payment via methods that are not secure (e.g. manually entering a card number into a payment device).

   
• What are red flags for spotting fraud in-store?
  • Always monitor payment devices and never leave them unattended.
  • Observe customers during the transaction – it should be a simple tap to pay or insert a card and enter a PIN. If a customer is taking longer than normal (for instance, having to look up their PIN)   an employee should intervene.
  • Document and periodically check each payment device to make sure they’re accounted for and not tampered with or swapped with a decoy. To do so, you can complete the following:
    • Keep count of devices and their serial numbers
    • Closely check state of device (does it appear damaged or tampered?)
    • Make a daily check part of the business’ opening or closing procedure

   
• How can a merchant protect their business against fraud?

  Implementing “healthy payment practices” like only accepting secure forms of payment can minimize fraud risk. More secure forms of payment also carry lower interchange rates, which is partially determined by factors like transaction type, card type, and risk level. For in-person payments, chip & PIN or tap should be the only options offered. For online payments, an ecommerce platform with a secure checkout solution is preferable to manual entry.