Welcome to a new entry of our guide to
essential payment terminology.
The Payment Card Industry Data Security Standard (PCI DSS) is an information security standard for organizations that handle cardholder information for the major debit, credit, prepaid, e-purse, ATM and POS cards.
Defined by the Payment Card Industry Security Standards Council, the standard was created to increase controls around cardholder data to reduce credit card fraud via its exposure. Validation of compliance is done annually – by an external Qualified Security Assessor (QSA) for organizations handling large volumes of transactions, or by Self-Assessment Questionnaire (SAQ) for companies handling smaller volumes.
Internet fraud refers to the use of Internet services to present fraudulent solicitations to prospective victims, to conduct fraudulent transactions, or to transmit the proceeds of fraud to financial institutions or to others connected with the scheme. Internet fraud can occur in chat rooms, email, message boards or on websites. Organized gangs can obtain credit card information through phishing scams, fake websites or POS.
Purchase fraud occurs when a criminal approaches a merchant and proposes a business transaction, and then uses fraudulent means to pay for it, such as a stolen or fake credit card. As a result, merchants do not get paid for the sale. Merchants who accept credit cards may receive a chargeback for the transaction and lose money as a result.
Internet marketing and retail fraud is a fast-growing area perpetrated by dishonest internet marketing and retail sites involving a variety of products and services. The victim is tricked, by a legitimate-looking site and effective marketing, into giving their credit card information and in exchange for what they believe to be goods or services. The goods never arrive, turn out to be fake, or are products worth less than those advertised.
Consumers find that once these types of scammers obtain their credit card information, fraudulent charge attempts will be made even after the card is cancelled. Credit and consumer protection laws in many countries hold the credit card company liable to refund their customers’ money for goods or services purchased with the card that are not delivered. The credit card company then has to absorb the loss, but these costs are ultimately passed on to consumers in the form of higher interest rates and fees.
(entries are derived from Wikipedia)