More than 90% of online purchases are made with cards, whether they are credit, debit, or gift cards. A virtual payment that takes place online or over the phone, without physical inspection of the card, is considered a “card not present” or CNP transaction.
In a CNP transaction, it is not possible to examine a card’s security features or signature.
This creates a higher degree of risk than when a card is physically present at the point of sale. As a result, merchants pay higher fees for CNP transactions, and they pass those costs on to the customer. Identity thieves can use stolen credit card data
to make CNP purchases, or they can copy the data to blank cards, which they can use at self-checkouts or when the thief knows the salesperson, who can “sweetheart” the transaction.
Blank cards can also be pressed with foils to create the appearance of a legitimate credit card. Device reputation, an effective online fraud prevention method, helps protect retailers from fraudulent CNP transactions by examining the computer or other device
for a history of unwanted behavior plus any suspicious activity at the time of transaction.
Protect yourself from credit card fraud by checking your statements regularly.
As long as you dispute unauthorized credit card charges within 60 days, federal laws limit liability to $50. Unauthorized debit card charges must be reported within two days, or liability jumps to $500.