The Green Sheet is a wonderful resource for merchants.
This article is full of info on how to avoid fraud. http://www.greensheet.com/emagazine.php?story_id=3208
"With the ever-growing problem of identity theft, fraud is of increasing concern to merchants, especially those in the MO/TO and e-commerce categories. Some merchants take an unreasonable approach and say they want a 100 percent guarantee that if they do next-day or same-day delivery with customers they don't know, they'll never have a chargeback. To that, I reply the dream factory is located in their nearest casino.
Nowadays, it's relatively easy for thieves to make credit cards and enter data they steal via skimming. MO/TO and e-commerce merchants are prime targets for these identity thieves.
HOW TO IDENTIFY FRAUD, READ ON...
So how are merchants supposed to know if a new client's credit card is legitimate? I suggest they take the following steps:
- Determine whether the cardholder's street address, ZIP code and cardholder verification value match the information given by the purchaser.
- If the information matches - and only if it is a physical delivery - require the cardholder's signature with delivery.
- Have cardholders sign credit card authorization forms, provide copies of their driver's licenses, as well as the front and back of credit cards.
If a cardholder doesn't have ready access to a fax machine, one company has devised a way to get signature and ID images. RightSignature LLC (https://rightsignature.com) provides the technology to enable customers to create digital signatures online...