The Importance of Auditing Credit Card Activity

The Importance of Auditing Credit Card Activity

While the importance of auditing your on-going credit card activity may be a no-brainer for some, for others, it is a burdensome tasks that often gets overlooked by many business owners who are busy with day to day business activities.  Some of the dubious activity going on may involve transactions that generate higher than normal fees,  show employee theft,  make known employee training issues, and detect illegitimate  charge backs by the bank.

Some examples of this are:

Higher Fees. – Users have an intermittently functioning MSR (Card Reader).  Rather than having the hardware issue addressed, the users stop using the MSR altogether, and start manually entering all card transactions.  Manually entered cards result in banks charging the highest rate possible under the merchants contract, resulting in higher overall fees.   For some businesses this can mean hundreds or perhaps thousands of dollars more a  month in additional business overhead.   – This is a hardware/training issue.

Credit Card Charge backs on Stolen Cards – Credit Card charges that were later deemed as  having been done on a stolen card that was not reported stolen at the time that it was used  by thieves.  The processor/bank gave legitimate authorizations of the cards and the business was able to settle them without error. Without notification to the merchant, the bank later charged back the transactions) to the merchants account.  – This is an illegitimate charge back that the  bank is trying to stick the  merchant with.

Credit Card charge backs due to user error – Users get a manual authorization for a transaction, and use the same authorization code for a different transaction on the same card.  The Credit  Cards transaction settles, and later bank auditing determines that an authorization was not given for the subsequent charges.   The bank then does a charge back for all subsequent transactions that used the same authorization code, often without notifying the merchant.  – This is primarily a training issue.

If you are having any of the above mentioned issues, please contact the CCS Retail Systems Support Department.


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