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CHARACTERISTICS OF A SUCCESSFUL PAYMENT METHOD: SECURITY
Card Testing Card testing occurrence can vary depending on the type of merchant. By card testing, fraudsters are attempting to make small or even $0 transactions to confirm the stolen credentials are useable. i Often, fraudsters will test stolen cards at merchants with lower average transactions before moving on to larger fraudulent purchases with the cards that are still active. While merchants are not able to catch all card testing activity, it is important for them to look out for red flags like increased failed authorizations or increased purchases with low transaction value. In an ecommerce environment, merchants may also want to work with their payment partners to verify the account credentials when a customer stores a credential-on-file for payment at a later date. There is a reputational risk involved when card testing isn’t monitored properly as well as financial risks like disputes, higher decline rates, and additional fees. 31 i Adding a card to a wallet sometimes checks the credentials and the card won’t be added to the wallet unless the credentials match, meaning card testing can occur without even making a purchase and the victim is never made aware
“Recent changes have upped the card testing stakes for merchants. The Visa Acquirer Monitoring Program (VAMP) that entered into force from June 1st 2025 contains an enumeration ratio of 2,000bps (i.e., 20% of sales). 32 This means that if a merchant has 2,000,000 attempted transactions in a month and over 400,000 of those are assessed to be card testing, they woul be in breach of the enumeration ratio threshold, regardless of fraud or chargeback volumes.”
JUSTIN STASKIEWICZ | DIRECTOR OF CONSULTING, FRAUD SOLUTIONS, CMSPI
Pig Butchering Scams Pig butchering scams, including romance and elderly scams, involve scammers using social media to open communication with someone and convince them to send money. For romance scams, the victim is convinced they are in love, and for elderly scams, the victim is usually convinced they must send the money or else they, or someone close to them, will be in trouble. While not direct fraud to merchants, fraudsters are using merchants’ gift cards as a mechanism to receive funds easily from their victims. In 2022 $1.3 billion was reported in losses to romance scams in the U.S. according to the Federal Trade Commission. 33 Gift cards were the most frequently reported way of transferring money – 24% of total reported scams, – while the costliest losses reported were completed using cryptocurrency and wire transfers – 34% and 27% of reported losses respectively. 34 Some organizations, like the United States Secret Service, have made efforts to try and protect their citizens from this type of fraudulent activity. 35 Merchants often utilize awareness and educational resources from these organizations to try to prevent these types of scams. These resources advise, for example, government authorities will never ask for a gift card payment, or to verify the identity of the person requesting they send them funds via gift card.
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