Visa, Mastercard Face FTC Inquiry Over Debit Card Transactions

Visa, Mastercard Face FTC Inquiry Over Debit Card Transactions

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Visa Inc. and Mastercard Inc. are once again facing inquiries by the Federal Trade Commission over policies that prevent merchants from routing debit card transactions over substitute networks. 

As part of a preliminary inquiry, the FTC has been reaching out to large merchants and their trade groups over this issue. The issue at hand is whether Visa, Mastercard, and other large debit card issuers are restricting retailers from routing some mobile payments and tap-to-pay transactions over alternate networks like Pulse, NYCE and Star. 

A spokesman for Mastercard, Seth Eisen, said that the organization will cooperate with FTC’s request. On the other hand, representatives for Visa and FTC declined to comment. 

FTC investigators are focusing on transactions made with mobile wallets as those can automatically route to the global application identifiers which employ the networks of Visa and Mastercard. Another aspect of the investigation is to make sure that the country’s largest debit card issuers are restricting transactions that don’t demand a personal identification number from being directed over other networks. 

The FTC has also investigated issues with debit routing in the past. In 2016, Visa modified its rules after an FTC inquiry, explaining that the retailers would not be required to demand the cardholders to choose a network for their transactions. 


Identity Theft Frauds – How can you stay a step ahead?

Identity Theft Frauds – How can you stay a step ahead?

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Identity theft is ‘a hot potato’ these days. Every day we come across news of online fraud that happened due to identity theft. The technology advancements have made fraudsters more sophisticated in committing identity frauds. In this case, fraudster carries out an online purchase using a different identity. This enables the fraudster to order items online under a false name and using someone else’s credit card.

Identity verification services can mitigate this fraud right from the root, saving your business. We often relate identity theft with account takeover and credit card fraud, but this is not about it only. There are multiple other types of identity theft that are not related to financial industries only, in fact, every organization having an online presence can fall victim to this fraud; the reason being the lack of identity verification systems and advanced security protocols. To deal with such fraud, it is essential to understand them first.

Types of Identity Theft

To cope with the identity theft issue one should be aware of all the types this term covers. Here are some of the types of identity theft:

Synthetic Identity Theft

Synthetic identity theft is the latest form of identity theft that combines a piece of a person’s original information and some fake information to build a synthetic identity. Due to its hybrid nature (i.e real information combined with fake information) these thieves can go undetected for a long period of time. Even if the synthetic identity fraud is detected, the thieves leave no trace behind to trace them.

Synthetic identity theft is sometimes also used by criminals to prove or convince someone that they are not the same person but someone else. This mostly happens in the case when the fraudsters try to enter the territory from where they have been blacklisted or restricted. Using the synthetic identities they show themselves as other citizens and easily gain access to the region or service. However, you can never know the intentions of the person using synthetic identity.

Child Identity Theft

According to Javelin’s research, 2017 out of all the reported breaches, 39% of the victims of the fraud were children in comparison to 19% of adults. As per another study, more than 1 million children fall victim to identity theft every year.

With the explosion of technology and smart devices, every child is exposed to the use of the internet and mobiles. This makes them the perfect target for identity thieves. From a practical standpoint, no child pays attention to his/her credit card statement, even most of the teenagers don’t do it unless they are up for getting a car or insurance. Fraudsters take advantage of this and use children’s identities to commit fraud and go on undetected for years. By the time parents and children are aware of identity theft, the criminals have already moved onto other prey leaving a burden of long credit reports. 

Medical Identity Theft

Healthcare data breaches are rising. A huge data breach named Anthem breach affected about 78.8 million people in 2017 which include not only the patients but employees too. Medical identity theft is one of the most critical forms of identity theft and also quite difficult to fix. The hospitals and pharmacists both can be fooled by the fraudsters and they aren’t able to differentiate between the fake and original patients. The perpetrators pretend to be someone else to get free medical services and get restricted drugs/ medicines from the pharmacy without getting suspicious. The world health organization finds medical identity theft to be the dangerous one claiming “the information crime that can kill you”. 

Financial Identity Theft

The first thing that comes to mind after hearing “identity theft” is credit card reports and bank accounts. Such type of theft that targets individuals’ financial statements and accounts are known as financial identity theft. With the increased data breaches in the industry, millions of customers’ accounts are compromised every year that results in billions of loss not just for the organizations but for the individuals as well. 

The data stolen from these breaches is sold in the black market, where cybercriminals are already set to impersonate an individual and carryout the illegal activities and fraud. The fraudsters can use credit card information to make unauthorized and fraudulent purchases. Sometimes, they can open new accounts using the stolen information of the individuals.

Social Security Identity Theft

The social security number of the person is the most sacred and critical information that one must not leak under any circumstances. There are multiple people who don’t want to pay taxes and find ways to manipulate tax regulators. Your social security number can be their escape from withholding taxes. The SSN of the person can be the most valuable information for identity thieves since they can register the company or work as independent contractors and can avoid paying taxes by using someone else’s SSN.

How can you Protect Yourself from Identity Theft Frauds?

           Identity theft is a growing concern. Cybercriminals are gaining grounds. They are coming up with different and unique ways to get to your privacy. You can always stay a step ahead just by taking some of the preventive measures against these identity theft types. These are:

  • Adhere to KYC:

           The intervention of government and regulatory agencies enforcing the businesses to meet the know your customer (KYC), Customer Due Diligence (CDD), Anti-money laundering (AML) compliance. Failure to do so can land them into some serious legal liabilities imposing a hefty fine and even imprisonment.

  • Use Identity Verification Solution:

          To deal with fraud and enhancing customer experience while meeting regulatory compliance, it is essential for businesses to adopt the latest identity verification solutions. 

  • SaaS-Based on Hybrid Technology:

          The services based on hybrid technology (i.e. artificial intelligence and human intelligence) can verify the identity of a person in real-time and detect the fake and synthetic identities hindering them from accessing the system. 

  • Be Vigilant against Suspicious Activities:

         Always keep a tight eye on your financial statements and go through them every now and then. If you find anything suspicious don’t wait for the action first, report it immediately to the respective organization responsible for it. 

Multiple IT companies are providing such digital IDV services including KYC verification, face verification, AML screening, address verification, and document verification, etc. which make the whole verification process frictionless, saving time and cost. Moreover, it isn’t just the businesses that are responsible for protecting their customers’ identity, the individuals are themselves equally in charge of protecting themselves from fraudsters. 

6 Steps of Online Fraud Prevention for Businesses

6 Steps of Online Fraud Prevention for Businesses

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With the rapid development in the online retail industry and banking industry, there is an increase in the fraudulent activities accordingly. New and emerging technologies are on one side serving the businesses in multiple ways, but on the other side, they are giving them a tough time. Fraudsters find loopholes and vulnerabilities in the system and exploitation allows them to perform malicious activities. These activities result in heavy fines and risks.
A huge amount is spent on online stores. According to a study, global e-retail sales amounted $1.9 trillion in 2016 which is estimated to rise to $4.06 trillion in 2020. Fraudsters have endless opportunities in the face of online stores and businesses. The businesses failed to comply with the security measures are prone to the cost of loss. Every $1 of the fraudster orders cost an additional of $2.62 to online stores and $3.34 in case of transaction done through mobile phones. The countries which issue cards are 2-3 times more affected by online fraud than the ones who do not. Credit card fraud is the most common. Fraudsters use fake credit card information and perform online transactions which at the end costs the online business.
How can online businesses prevent themselves? What steps should be taken into consideration? The techniques of fraudsters are getting advance. Therefore, the pace of online businesses to introduce betterment in the system should also increase. For any business, it is important to take serious steps in order to prevent themselves from online payment scams and credit card fraud.
Following are 6 steps that can ensure safety in their customer onboarding process:

Need of Online Fraud Prevention System

Need of Online Fraud Prevention System

54% of businesses are somewhat confident about the security of their system. Only 40% are confident, who say that their system is unaffected by any attack or bad activity. The reason is that most of the businesses give more importance to conveniency than security. These businesses then face heavy loss which costs much more than the cost of security adoption.

Customers need Protection

66% of the customers want a secure online Fraud Prevention System. They want their identity and personal information to be protected and not to be used in any malicious activity. These concerns demand online marketplace to take serious measures in order to prevent the data and money of their customers.

Prevent Money Laundering and fraudulent transactions

67% of fraudulent transactions remain undetected. Who belongs to these transactions? What is their identity? These questions should not remain unanswered as they carry a heavy cost. For money launderers, the online marketplace is an attractive target which can help them in money laundering.
There should be proper AML checks in the system which catches them on the spot and suspend their activities and transactions.


Fraudsters activities fluctuate with respect to time and behaviours. These activities must be monitored actively and so the adoption of updated technology should be ensured. The above steps are the primary ones which need to be the part of any online business. The need for security measures varies according to the business type and fraud potential risks associated with it. To mitigate these risks, a proper protection curriculum should be shared in the business environment. This can help in remarkable business development with respect to both revenue and reputation.

How Businesses Can Avoid Identity Verification Fraud in 2019?

How Businesses Can Avoid Identity Verification Fraud in 2019?

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With a bulk of customers using online services, businesses wish to digitise their operations and provide online modes of payments for their customers. Amidst this digital integration arises the threat of credit card fraud and what business must do to protect themselves from it. The figure for worldwide card fraud losses crossed the mark of 31 billion US dollars in 2018. Although consumers suffer in the worst way through credit card scams, businesses are not far behind and can suffer just as much – if not more.

Fraud Prevention tips for Consumers

Every now and then, almost every entity including governments, banks, financial institutes and businesses issue numerous credit card fraud detection tips for consumers. Individually every credit card user must be smart and vigilant enough see some obvious warning signs for fraud;

  • Beware of phishing scams – never click on links provided via e-mail; they tend to have malware.
  • Beware of social engineering scams. Banks, governments and online retailers never ask people for their personal information (ID card numbers, account or credit card numbers, passwords and PINs) via e-mail, phone calls or direct messaging.
  • Keep your personal information secure and avoid giving out any potential identity information on social media platforms. Block your stolen credit card as soon as possible and report the theft.

As technology has advanced at an exponential rate worldwide, credit card fraudsters have found better and yet more sophisticated ways to commit credit card identity theft. Thus it is equally important for businesses to implement equally advanced fraud prevention measures. Individually every business may not be able to develop sophisticated and effective online fraud protection. In recent years, however, the fraud prevention industry has made impressive breakthroughs in this regard.

Apart from such anti-fraud solutions, companies also need to take some active measures to prevent identity theft on their end;

Monitor Your Transactions

In a world dominated by consumers, most of them have moved away from cash payments and are increasingly using online payment modes. Although the use of EMV chip cards has made it difficult for scammers to commit credit card fraud, they can still find ways around them. For this purpose, it is important for businesses to monitor their transactions, both online and physical. There are a number of warning signs in a transaction that can alert you as to whether it is a fraudulent one.


  • Check to see if the billing and shipping address for the transaction same or different. If so, then why?
  • Also, evaluate the average order size for the nature of your business. If any transaction is larger than the average amount, check to see why.
  • Be careful in case the order has been requested overnight.
  • Be in the lookout if a large number of orders have been placed through the same credit card.
  • Beware if your address verification provider cannot verify the shipping address of the customer.

It is understandable that no business can verify each and every single one of its transactions individually. Particularly if the transaction volume of the business is large, manually verifying each transaction can take an army of human labour. For such situations, it is advisable to avail the services of a verification service provider that can authenticate both the identity as well as the address of every transaction through an automated procedure.

Implement Damage Control if Credit Card Fraud Happens

The only way businesses can completely eliminate online credit card fraud or identity fraud is to not accept credit cards or online payments at all. This is obviously impossible as almost every consumer owns a credit card or prefers to shop online. Therefore, entirely eliminating fraud is an unlikely scenario for businesses as well as consumers. Businesses should be vigilant if any cases of card fraud surface. Firstly, it is always advisable to report the crime to the relevant authorities to take the appropriate action. You should always cooperate with them and provide them as much information about the crime as possible.

Also, be responsive to customers who have been affected by the fraud and provide them with any assistance you can. Listen to their case vigilantly and try to compensate them in any way you can.

Modern Credit Card Fraud Prevention Tools

The market for fraud prevention solutions has expanded over the years. Amidst the solutions currently available for credit card fraud protection, Shufti Pro has emerged as a leading Know Your Customer or KYC verification service provider. It is the best credit card protector for any business and provides a number of verification services to businesses.

It is a SaaS product that provides document verification, address verification and facial recognition services to businesses. Shufti Pro’s AI-based authentication software can verify customers within seconds. Credit card fraud prevention has never been easier. Through customer verifications, businesses can ensure that each of their transactions is legitimate.

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