For a small business in Washington, credit card fraud can be a real pain to deal with. It can lead to a loss of product or revenue in addition to the time spent working with the bank to figure out what happened. It poses a real risk to business profits.
Liability for credit card fraud
Credit card fraud can happen to any business, but there are some ways for a small business to protect itself. The most important way is to make sure that the point of sale system uses EMV readers for any in-person transactions. As long as all transactions are processed either online through a secure portal or through an EMV reader, then the company is not liable and responsible for any transactions that are made fraudulently. Instead, it will be the bank or credit card company that is liable. However, the business could be liable if it allows for a card that has a chip to be swiped to pay rather than inserted. This is because swiping is less secure.
These rules mean that is crucial for small businesses to protect themselves and do the right thing when it comes to business transactions. If the business follows all the rules, then they could be made whole of any potential fraud that makes use of unverified credit card transactions. Failing to do so means that the business is on the hook to return the money, which can be substantial if scammers try to use stolen credit cards to place large orders.
Businesses need to protect themselves from liability when it comes to credit card fraud. Part of this is ensuring that they are up to date on the rules and regulations.
