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ABTA urges agents to take fraud precautions

ABTA has warned agents not to rely on authorisation from the banks as a safeguard against being hit by huge charge-backs after credit-card companies detect a fraud.


Every year agents are stung for thousands of pounds after chargebacks, despite getting authorisation from the banks that the transaction is OK.


Speaking at a seminar on credit-card fraud, sponsored by Travel Weekly and American Express, ABTA head of financial services Mike Monk said: “I have asked the banks to stop using the word authorisation because when you get authorisation it is easy for agents to relax. You are only being told at that precise moment in time that the card is not stolen and the cardholder has not exceeded its limit.


“It may take a couple of days for the cardholder to find out it is stolen but most fraudulent activity is done in the first hour of the card being taken. You cannot put the onus on the banks. It is up to you to stop the frauds,” he told agents at the seminar.


Monk said it was not unusual for an agent to get a £5,000 charge-back, which could be a disaster for a sole trader.


“They would have to sell £50,000 worth of holidays to cover the loss and that could put them out of business,” he added.


He urged concerned agents to go through the set procedure suggested by credit-card companies to check the validity of the card. If agents are still in any doubt about the transaction, they should do a Code 10 call so the credit-card company can do an extra check.


He urged agents to not be afraid to ask the customer questions, for example, their telephone number and mother’s maiden name.


Another good way of checking if the card is OK is to check for the a three or four-digitnumber.


While Amex has a four-digit number that is not embossed, other credit cards such as Visa have a three-digit number on the back of the card.


Signatures should be matched with those on the back of the card.


He said it was not unusual for fraudsters to have signed their name Mickey Mouse or Adolf Hitler.


Meanwhile, Monk said the banks were planning to use the three or four-digit security code and the cardholders address as part of their authorisation process by 2001.

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