When the EMV liability shift made its debut in October 2015, it created a lot of buzz, but it also came with a lot of confusion. What many small to medium sized businesses didn’t understand was that this shift would cause credit card thieves to target smaller businesses for their crimes.
Unfortunately, we have recently witnessed small businesses suffering monetary loss due to fraudulent card use, and it just proves that criminals are taking aim at small to medium businesses. These businesses accept EMV payments, so how are thieves bypassing this system setup to protect cardholders and businesses alike? They are making their failed payment attempts look like terminal error causing a business to key-enter the card and eliminating the security steps needed for EMV transactions.
How they do it
After fraudulently obtaining a cardholder’s information, the criminals are creating their own “copy” of the card with a magnetic strip but no EMV chip. When paying for a transaction, the card gets swiped and the terminal displays that the EMV chip must be inserted. At this point, the employee completing the transaction will likely manually key in the card thinking the terminal has malfunctioned because this card clearly has no chip. The transaction is approved, and everything seems fine until you get a chargeback notification for this payment. Because of the EMV shift, it is now your business’ responsibility to cover any fraudulent transactions. This means even if you dispute the chargeback with the appropriate information, you will not receive your funds.
Protect your business
As a business owner or manager, you can take many steps to ensure your business is protected from fraudulent card use. Here’s a list of things you NEED to do to avoid losing potentially large amounts of money.
1. Make sure your EMV equipment is properly working.
Faulty equipment isn’t going to protect you in the event of fraudulent card use. You’ll want to be certain the technology is current and updated.
2. Educate your employees.
Train your team about card fraud and what can happen if they do not follow proper protocol in regards to transactions. If someone is genuinely trying to make a purchase, he or she will not mind providing another card or calling their card provider to determine the cause of any potential card read error.
3. Talk to your merchant provider about updates and current events regarding card acceptance and fraud.
This industry is constantly changing, and keeping an open dialogue with your provider will help you stay aware of potential risks and changes. Join our email list to receive occasional newsletters and information. We will gladly keep you in the know.