Credit card fraud has escalated to an alarming rate over the past few years. According to Master Card credit card fraud has increased by 369 percent since 1995. It is one of the more difficult frauds to combat and since there is no face to face interact or voice to voice interaction over the internet it is one of the more used forms of fraud, giving the criminals a greater sense of comfort.

There is more then one way that a card can be used fraudulently on your internet website. It could be a child stealing a parent’s credit card, a lost or stolen credit card that has not yet been reported, or even the more prominent identity theft scam, where a card has been issued under someone else identity and information.

You have to be able to protect yourself and your business from this fraud, because the credit card companies will hold you the merchant fully responsible for the transaction. Which means you not only lost your physical product, but the cost of your product and in some cases finds an additional $50 charge back fee. You can even be black listed from your merchant account if you have too many charge backs.

So what is it that we can do about on line credit card fraud? There is a few ways that you can check if the person is a real card holder. First you can verify the customers billing address. This can be done automatically by the AVS System or known as Address Verification System. This will be able to check that the billing address matches the information the company has with the card. But this only works for address within the United States.

Another problem with verifying the billing address is that the internet allows us to purchase products electronically and not just purchased electronically but also delivered electronically for example movies, software, music, e-books, and ect. Another thing that you will have to watch out for when verifying the address is that the AVS System provides no protection at all if the thief obtains a valid address that goes along with the stolen credit card.

The next way that you can check if it is a real card holder is to be careful of purchases from a free email address. The purpose behind them getting a free email address is that they are hard and sometimes impossible to trace. If the customer has a paid email address another good thing to do is to check their website. All you have to do for this is to put a www. In front of the last part of the email address for example if someone has an email address that is joe@mywebsite.com just put in www.mywebsite.com and check if the contact information on the website matches the information on the billing address.

Another thing you can do is tell your visitors of all of you anti-fraud systems that you have in place even if you don’t have any in place. This will deter most thieves just by warning. It is the same concept of somebody putting a home security system signs in their lawn and not having a security system hooked up. There is no way for the thief to tell if they are in place or not. They prefer easier targets. Lastly beware of international orders. Orders from the Middle East, Egypt, and some African states have some of the highest fraudulent rates.