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Computer Hackers are NOT the real problem with the security in today's electronic commerce. Computer Hackers By Definition are people who test the security of systems for knoledgable gain. Loose translation. Real computer hackers enjoy the thrill of entering a system un-detected and leaving just the same. Please read below.
Technical Notes:
Computer Hackers
Computer hackers by default are people who enjoy entering systems in which are claimed to be secure. This grand chase so to speak is what Computer Hackers Strive for.
Many companies hire computer hackers to test the vulnerabilities of there systems. These hackers break into systems and report holes that company engineers quickly seal.
Recently computer hackers have been blaimed for 40 million stolen credit cards from a single credit card processing company. People all over the world are now worried that there information may be used for identity theft. A report on the television states that credit card theft is a major global business that is costing some 40 billion dollars in losses every year.
What the television stations fail to explain is how the credit card purchase process really works, who takes that loss, who is responsible for these actions if your card is stolen and used without your knowledge.
This is what we are going to explore here in this section:
Role of the computer hacker or scam artist:
Obtain as many personal accounts as he can to sell to overseas crooks. These people pay big money for complete customer account information such as card number, billing address, names, phone numbers cvv2 data and so on. They then use these cards to purchase goods and services and often have them shipped overseas.
Many people think that if there is a problem with there credit card account that the credit card company eats the losses. WRONG !!!
Credit card companies simply place the burden of proof on the credit card processing company who passes it along to the merchant. It is the merchants job to proove that he or she secured the payment method and shipped the goods to the billing address of the card on file.
What does all this mean ??
John Doe has his credit card lost or stolen and charges appear on his account that he doesn't recognise. John Doe calls his credit card service center and reports these transactions as suspicous.
Temporarily the amount charged on John Doe's card is placed back and he is happy for he is NOT liable for the charge since in fact he didn't make it.
Now, The credit card company initiates an investigation into the charge, what does this really mean ?
The credit card issuing bank simply deducts the funds from the merchant who sold the goods or services and sends out a report that calls on the merchant to provide proof that he or she filled the order and secured the funds to the card issuing bank's requirements.
O.K. What does this mean ??
When you have a fraudulant charge, the credit card company takes the money from Jane Doe's Account ( The Company or merchant who received the order and charged the account ). Jane Doe now has to prove to the credit card issuing bank that they filled the order to the CORRECT customer at the CORRECT address and have PROOF. If the merchant has enough proof to show they verified the billing address and shipped with confirmation the goods to that address, they may in fact win the charge back.
Oh, by the way. the credit card issuing bank charges the merchants a fee for the paperwork for handling the charge-back. And some banks charge you the card holder a fee of up to $ 50.00. So who is really loosing here. The merchant and the customer.
The merchant has lost the products or services they suplied to the scam artist and they have lost the money for the order along with the adminstration fee for processing the charge-back. The credit card issuing bank looses nothing.
What can you do as a merchant to help prevent this from happending.
Four Easy Things to watch for:
1) You as a merchant have the right to verify account holder addresses. You can do this by contacting visa mastercard at 1-800-337-2255 and asking for an address verification. If it matches the billing address on the order form, you can fill it.
2) Be smart. Offering separate shipping addresses is risky because you have no idea if the person placing the order is the real card holder. Some one who obtained your information could be using it to order things with the correct billing address, then shipping it to another location.
3) Use common sense, DON'T ship to countries overseas that are questionable in nature. Nigeria, Pakistan, Indonesia, Ghana and so on.. Read the US Government warning on overseas scams on the US government website. There they place warnings about scams from overseas and warn US merchants NOT to engage in order fulfillment with anyone from these countries unless payment is made in a secure manner.
4) Avoid Cashiers Checks from the above countries as well. 99% of them are fake. They will come in a plain envelope and have no return address. Now Really, who sends a large cashiers check in the mail in a plain envelope without tracking and a return address. Sure it will clear for a couple days, then the bank will take all the money back and you are again on the loosing end of a scam. This is called the "nigerian check scam".
The rule of thumb should always be, if you don't feel right filling the order, don't. Email or call the customer and explain your secure payment method policy and offer different ways to pay such as western union, money gram, cash or US postal Money Orders. If the person is real, they won't have an issue meeting you in the middle. If they are scammers, you will never hear from them again.
Remember, the merchant looses, NOT the credit card issuing banks.
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