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The project that I am working on requires processing of credit cards. Is there any way to detect cloned/counterfeit cards? Are there any proven workarounds to prevent credit card fraud or misuse?

We are asking the customer to swipe their credit card at the POS, so no CVV is necessary. However we would like to be able to detect any cloned/counterfeit cards, if there is any such possibility of doing so.

The challenge of identifying fraudsters becomes even more complex in an unmanned POS like kiosks etc. Right now CC companies or payment gateway don't offer any protection against fraud in unmanned kiosks etc.

Already a question in stackoverflow. However was closed as appropriate here, so reposting question for further inputs.

Question updated with the case of unmanned POS such as kiosks

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  • en.wikipedia.org/wiki/Credit_card_fraud refer this for methods to fake credit cards and hope it will help you upto some extent
    – BlueBerry - Vignesh4303
    Oct 25, 2012 at 12:29
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    The reason clone cards even work is because you cannot detect them at the merchant level. The credit card vendors and banks might be able to, but based on past account behavior, which isn't something as a merchant you have access to. You should use the best pratices to prevent fraud at your level, otherwise your mercant contract itself, will protect your expenses in this regard.
    – Ramhound
    Oct 25, 2012 at 13:05

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A male cardholder using a card with a clearly feminine name would be a potential flag. Other than cardholder gender, though, there isn't much you can do to verify non-fraudulent transactions. As a merchant you do not have access to the full history of purchases the CC company does, and purchase record analysis is how most fraud is detected.

Generally speaking, if a criminal group is going to the trouble of cloning credit cards to be used at a human-operated POS, they will go to the trouble of making them convincing. The detail work on a credit card is less intensive to replicate than the magstripe.

Brian Krebs has numerous entries on credit card skimmers and monetization of stolen/cloned credit cards. Most of his information isn't germane for your situation, but sifting through what he has written might give you some ideas.

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Your best bet is to make use of the (very good) anti-fraud capabilities built-in to the gateway you use (Authorize.net, Linkpoint). Ask for, pass along to the gateway, and evaluate the answers you get back on AVS and CVV. Set the gateway account not to accept transactions that do not pass CVV or AVS. The anti-fraud capabilities of the gateway can be very, very good, but you have to take the time to understand them and use them.

That's about the best you can do.

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Not sure about cloned, but you can check to see if the card is counterfeit by checking the 16 digit number against the Luhn Algorithm.

ALL 16 digit card numbers must adhere to this rule before being validated by the banking system.

PHP Luhn Checker - validates credit cards etc

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  • Luhn Algorithm will validate if that is a valid credit card, however, it does not provide fraud related protection.
    – Prabhu R
    Oct 25, 2012 at 14:06
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    unfortunately it's pretty easy to get cards which pass that check but which would still be counterfeit e.g. getcreditcardnumbers.com
    – Rory McCune
    Oct 25, 2012 at 14:33

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