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Online Fraud Tips

Read these 6 Online Fraud Tips tips to make your life smarter, better, faster and wiser. Each tip is approved by our Editors and created by expert writers so great we call them Gurus. LifeTips is the place to go when you need to know about Shopping Cart tips and hundreds of other topics.

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What do I need to know about fraud detection software if I'm going to do business online?

Doing business online and fraud detection software

As a business owner, there are two levels of fraud detection software with which you need to concern yourself. First, you want to make sure your employees are not embezzling money by cutting checks to false vendors or buying personal items with corporate funds. Second, you want to make sure that the credit card payment you are accepting is legitimate so you won't ship off your product and never see payment. Typically your merchant account and payment gateway will be responsible for fraud detection software in terms of credit usages. You will also want to monitor your internal accounting to make sure you have appropriate checks and balances in place, such as having one person enter the vendor bills and another one cutting the checks.

   
What kinds of business use fraud protection software?

Fraud protection software

Businesses from every industry are at risk of fraud and can use fraud protection software to proactively monitor usage and charges. Telecommunications company look for a disruption in usage patterns. Credit card companies monitor unusual purchases and are especially watchful of internet purchases and online fraud. Make sure any ecommerce software you use has some fraud prevention features built into it. For example, many ecommerce solutions will collect the IP address of customers for future tracking. Some may offer IP blocking to eliminate access by known problem sites.

   
I never buy anything online, so I don't need to worry about online fraud, right?

Online Fraud

Whether or not you buy anything online with credit cards, you are still at risk for online fraud. Your bank, your credit card companies, brick-and-mortar stores, and others that you do business with might make you vulnerable to online fraud. Hackers break into computer systems just like burglars break into storefronts. If they gain access to credit information about you, online fraud can unfortunately become a reality for you even if you've never used that credit card online. Protect your social security number and question any time someone wants to collect that from you. Try not to use it as a user id for any kind of online system. Also, watch the charges on your credit cards and make sure they are all your own.

   
How do I protect myself against online fraud?

Online fraud and your credit report

It's a good idea to check your credit reports periodically and make sure that online fraud is not putting you at risk. If you have recently been denied credit due to a bad credit report, you can request to see the report. Check it for errors and if you find any, report them to the credit agency that issued the report and request that they update their records. Make sure that all accounts reported are in fact yours and that any paid off loans are shown as paid in full. Contact the company that denied your credit application and let them know that the report contained false information and it's being corrected. Make sure you see a copy of the corrected report and keep records of your correspondence with the credit agency.

   
How can fraud protection prevention software tell if something fishy is going on?

Fraud protection software and your online business

Fraud protection prevention software analyzes transactions and financial data for suspicious activity. Activities that might arouse suspicion includes an unusual number of transactions, a sudden increase in the size of transactions, or a geographical change in where the charges are taking place. Fraud protection software looks at trends and uses predictive technologies to spot offline and online fraud at early stages in the game, to minimize your risk.

   
Do I need any kind of fraud prevention software to run my small business?

Fraud prevention software

Fraud prevention software monitors your financial applications and data, spotting trends and transactions that don't seem to be legitimate. Employees might try to charge items for personal use to your business accounts, for example. Fraud prevention software typically monitors checks being cut to the same vendor, checks that are just under the amount that requires a second signature, and changes to a vendor's address (allowing legitimate checks to be delivered to someone else). You should conduct a risk analysis prior to implementing a fraud protection prevention. Whether you are a large or small software companies, you do have a certain amount of risk of both offline and online fraud.

   
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