Sunday, May 11, 2014

267- Avoid Being an Ecommerce SMB Victimized By Credit Card Breach

How is the National Football playoffs like a holiday season credit card breach? Some teams like large enterprise online retailers have a practically untarnished image. Even so, if the team is compromised by "under the table" payoffs masked with faulty officiating calls or ecommerce is compromised by credit card breach and even worse, with DDoS on top of that, negative results explode. Read on to find out how to be ready to arm organizations with DDoS defense and credit card breach avoidance.

Avoid Being an Ecommerce SMB Victimized By Credit Card Breach

DDoS and credit card breaches do go hand in hand in online crime. When DDoS is left out, the victim e-commerce business is just a little luckier, but the victim's customers are not, and neither are the other businesses whose products are purchased with the compromised credit cards. Cyber criminals steal millions of credit card numbers during the busiest seasons of the year such as winter holidays and just before the typical school year begins. 

Leading retail giants end up paying huge fines. Meanwhile, people use the stolen credit card numbers to make online purchases with all types of electronic commerce sites in the USA and overseas. People buy copies of the credit cards in the Internet underground. Who suffers the most? Even one breach can bilk hundreds and possibly even thousands of small businesses out of products and services who become crushed financially with chargebacks, higher merchant service fees and other undeserving punishments.

The opportunity cost is horrendous for these small online businesses who do not have an actual physical presence as opposed to the world's largest, most successful online stores who also have thousands of physical stores all over the world. Much smaller businesses do not tend to do "brick and mortar" business since choosing to do all business online can decrease human resource and infrastructure cost. 

Examples are an online setup of flower delivery or customized suit service over the net. Their potential loss of income could be insurmountable and even result in closing. Plus, customers feel an aversion to being defrauded again. Word spreads that shopping online in general is too risky and specifically at any certain "stores" where card numbers were stolen and/or used fraudulently in the past.

While a major chain of stores' reputation is tarnished for a while for a once in a lifetime card breach, loyal fans may still speak well of them. The conglomerates may have to pay huge fines, but they also have big pockets. Customers whose cards are stolen will file chargebacks to have the charges returned, sometimes with additional interest and chargeback penalty fees up to $20 each transaction that the merchant service adds. 

The online stores that the cards are used on such as for telecommunications, paid streaming video content, gambling and gaming services will have to "chugalug" the total cost just as a team in a football play-off will have to accept unfair referee calls.

Small businesses who begin sales and service online with cool new innovations are likely targets for the stolen credit cards. It is common that the customers, the major retail online stores itself, credit card companies and banks and merchant service payment providers will not suffer anywhere near as much as some of the most innovative but tiny and new e-commerce companies. The start-ups lose products that are shipped to fraudulent or fake customers. 

They lose the money paid to them by credit card companies for the products. Merchant services will also increase the recurring monthly service fee for these SMBs who were not the original guilty party who left the credit card numbers vulnerable to online thievery tools.

What can businesses do to thwart or even at least slow down culprits who are among the global rings that steal credit card numbers online, make fake copies, and sell them on the black market? Credit cards with the magnetic strips are too easy to copy. The alternative of a digital chip is more secure, too. Guess how old the USA's Federal Trade Commission security standards laws is? Consider the answer is a number that is older than most people will ever be, almost 100 years old!

Meanwhile, there are some traditional and cutting-edge strategies to cut credit card theft and fraudulent use that may still take place for days or weeks. First, use address verification and card code verification for every signal "card not present" sale such as over the phone, Internet and hard copy mail orders.

When a business double-checks credit and debit card orders before fulfilling:

1. Customers who refuse to give necessary contact information with orders stating for privacy reasons

2. Billing name and addresses that do not match credit card or bank files

3. Strangely huge orders

4. Customers who demand exorbitantly high-priced total orders in a rush

5. Purchases for items with a credit card might request shipment to an address that is not the billing address or with a credit card from one country but shipment goes to another country.

6. A sudden increase of orders from international locations when that is not the normal business history

Last, could there be anything worse security-wise than the credit and debit card data breach online? Yes. Cyber-criminals may very well take advantage of any company's website and system software vulnerabilities to gain access into the network. On the other hand, if DDoS attacks accompany the exploitation, the victim's security team would be overwhelmed, and for some time, potential customers would not be able to shop, login to accounts and buy products. Perpetrators could steal the customer card information on file and essentially keep the online enterprise from one of its typically best sales seasons of the year.

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