Q&A: How can I protect my credit card from online scams?

What is ‘card not present’ fraud?

This is a type of credit card scam when a customer makes a payment on the internet or on the phone without needing to physically present the payment card.

How does it happen?

‘Card not present’ (CNP) fraud can happen when a criminal obtains a cardholder’s name, billing address, account number, three-digit security code and card expiration date. These details can be stolen electronically without actually accessing the physical card. The theft of this data usually takes place through online phishing.

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Why do we need to be so careful?

People are increasingly choosing to shop online with Irish consumers now spending €850,000 every hour in online sales, according to Excellence Ireland. With this constant use of credit and debit cards, we must take extra care to protect our personal finance details.

What can I do to protect my payment card when shopping online?

• Buy from trusted sources.
• Never send you card number, PIN or any other card information by email.
• Use brands and shops that you are familiar with or have used before and check the ratings of individual sellers on sites like Amazon and eBay.
• Avoid doing online shopping at sites that don't use full authentication (verified by Visa/Mastercard/Secure Code).
• Control all recurring charges. Before you hand over your card details to pay for a continuous service online, find out how you can stop that service.
• Use credit cards when purchasing items online. Most credit cards have a strong customer protection policy and it takes up to six weeks for the money to come out of your account. When you use a debit card, the money is taken out of your account immediately.
• Never send your card details in an unencrypted email. Some online shops outside Europe may request a copy of your card and passport by fax as a guarantee.
• Make sure the data transfer is appropriately protected. Look for the padlock symbol on the IRL bar and use HTTPs and SSL when browsing the internet.
• Always save the documents relating to your online purchases. You may need them in the future as proof you have paid for the goods.
• If you're buying something online from another person do not send money upfront to the seller. If possible, reserve the right to receive the goods first.
• Don't send money to anyone you don't know. If someone approaches you online and asks for money think about whether you would give the same amount to a stranger on the street.
• If you are not buying a specific product or service, don't submit your card details.

What can I do to protect my small business from CNP fraud?

While all businesses operating online are at risk of internet theft, smaller businesses must take extra care to ensure financial transactions are carried out in a secure and reliable fashion. Detective Superintendent Gerry Walsh warns that the financial implications of CNP fraud can have a profound effect on small business and that retailers should immediately contact their local garda station if they suspect suspicious activity online.

“The Garda National Economic Crime Bureau has trained hundreds of gardaí to investigate cases like these. Our key is prevention, to make sure we stop this before it happens, because it can have a profound effect on small businesses. The retailer has to pay for it in the end and it could have a knock on effect on their business.”

Unfortunately small businesses who suffer financial losses from CNP fraud will rarely get the money back, says Det Superintendent Walsh. “The payment will go to the person whose card has been compromised. If the goods are lost and they’re still out there we may be able to recover them but it can be difficult to get your property back. We need to prevent these things before they occur.”

Lorraine Higgins from Retail Excellence says business owners must ensure staff are adequately trained in internet safety and take the time to check through payment details. She recommends that extra care be taken when a consumer uses a card in a different name and says all businesses should use 3D authentication through verified by Visa or Mastercard.

What is the European Cybercrime Centre?

These are the people who work to protect European citizens, businesses and governments from online crime. The centre was set up in 2013 to strengthen the law enforcement’s response to cybercrime across Europe. It focuses on cybercrimes that generate large criminal profits and that seriously harm victims such as online child sexual exploitation. Cybercrime costs EU Member States €265 billion a year.

How much does card fraud cost us in Ireland?

In 2015, card fraud was €29.6 million in Ireland. Some 70 per cent of these purchases (almost €21 million) were carried out through ‘card not present’ fraud by online purchases, telephone purchases etc...

In the first half of 2016 there was €20.8 million in card fraud in Ireland. Some 78 per cent of this fraud was through ‘card not present’ incidences.