The Orangeville Police Service is cautioning local merchants to be careful when using mobile payment phone apps to complete point-of-sale transactions.
Recently a number of retail businesses in Orangeville were victimized by fraudsters who made purchases with stolen credit card information. The transactions were completed using smart phone mobile payment apps with point-of-sale equipment. An actual credit card was not presented to store staff members.
During the transactions there appeared to be a glitch with the technology. The pin pad was turned over to the customer and a credit card number was entered manually. The transactions were completed and the customer left the store. The businesses involved were later notified that the transactions were fraudulent.
“In most cases, financial institutions are not prepared to reimburse businesses for transactions when a credit card is not presented and a card number is entered manually, when a fraud has been recognized”, explained Constable Scott Davis. “M-Payments using smart phones are relatively new but are only going to become more commonly used as people gain a greater knowledge of the technology”.
Merchants are advised to seek advice from their financial institutions and point-of-sale equipment providers regarding best practices to safeguard against these types of frauds.
In the meantime, businesses are encouraged to consider some temporary policies around the use of mobile payments with phone apps such as limiting the dollar amount allowable for those types of transactions, asking to view an actual credit card, and seeking a verbal authorization with a credit card company at the time of the transaction.
Any other businesses who suspect that they may have been the victims of this type of fraud are encouraged to contact police.