CREDIT CARD FRAUD RISK QUESTIONNAIRE

Fraud is the intentional perversion of truth to induce another to part with something of value or to surrender a legal
right. In the business community, the ultimate goal of fraud is to gain money. There are numerous fraud scenarios
within the business world and, unfortunately, many have transitioned into the internet community. Focus on the
following questions to learn more about the organization’s management and monitoring of credit card fraud risk.

CREDIT CARD FRAUD

• Who is directly responsible for monitoring fraud?

• Does the organization research its customers' transaction history to formulate a profile of the typical
transaction?
• Does the organization track and analyze fraudulent transactions?
• Does the organization have specific procedures for escalating and dealing with instances of fraud?
• What measures does the organization take to manage fraud risk appropriately? Are these measures designed
to prevent fraud or to monitor it?
• What is the current percentage of fraud in total transactions? What is the dollar amount that was expensed to
fraud in the most recent financial quarter/year?
• How much fraud risk can the company manage and remain profitable?
• Does the organization have a customer service department dedicated to following up on suspicious
transactions?
• How many orders can the company afford to review manually?
• If a fraud debacle occurred, could the resulting loss of customer trust damage the organization's market
valuation, revenue stream or public image?
• Does the organization’s business model rely substantially on establishing trust with users regarding protecting
their personal identifying information before success can be achieved or to fuel the growth of the customer
base?
• Does the organization have a public fraud policy, outlining what constitutes both internal and external fraud?
Does the organization make a public statement on its website and in internal documentation that fraud will not
be tolerated and that the organization will prosecute all known offenders? What steps does the organization
take to ensure that all employees know the policies concerning fraud?
• Does the organization operate in any areas where a lack of adequate fraud prevention could result in civil or
criminal liabilities from individual consumers or credit card companies?

1 Source: www.knowledgeleader.com