Associations: Preventing credit card fraud: Lesson #1 “Carding” attacks and prevention?

Authors: Joseph Stangl CPA, CFO, Air Force Association; Julie Duncan, Association Practice Leader, U.S. Transactions Corp.;

What if you were suspended from accepting Visa/MasterCard, AMEX, and Discover?

As an Association you probably rely heavily upon your members/customers paying by Visa/MasterCard, AMEX, and Discover for membership dues, continuing education, certifications, event registration, and a myriad of other activities.  So imagine what would happen to your business if you couldn’t accept credit card payments for any period of time.  Even the prospect of not being able to accept credit cards for even 30 minutes due to your services being down during the peak time of registration for an Annual Event would be a major problem.

In this 1st article in a series on credit card fraud for Associations, we discuss the implications of a common fraud occurrence called “Carding.”  If your Association is hit with a Carding attack from a fraudster, it could lead to an immediate suspension of your credit card processing services (also called merchant services) for an indefinite period of time which could result in significant loss of revenue or reputation to your Association.

What is Carding?

Carding is a form of credit card fraud where thieves use stolen credit cards to run up fraudulent purchases and/or to sell them to other people. This information is often bought on the dark web. People perpetrating this type of fraud are called “Carders”. Because credit cards are often canceled quickly after being lost, a major part of Carding involves testing the stolen card information to see if it still works. Bots are often used to run a large volume of card numbers in the shortest amount of time to verify if the card is still active.

If you see a large volume of small transactions being tested on your merchant account, it is possible your account is being used to test stolen cards. You must react quickly and deliberately.

What should I do if I suspect Carding on my account?

Credit card fraud can be a significant problem for merchants with widespread consequences. If you are a victim of fraud or suspect fraudulent transactions, take the following actions:

  1. Contact your merchant bank and notify them that fraudulent activity has taken place.
  2. Issue a VOID or CREDIT to the card or cards to avoid chargeback fees from your merchant bank.
  3. Verify security of your login and password information both internally and on your website.
  4. Contact your Internet Service Provider (ISP) or hosting company to see if they have a record of the IP addresses where the fraudulent transactions came from. Next, have your account restrict access from those IP addresses.
  5. Complete a full virus and malware scan of all systems involved including your website and computer stations.

How do I detect and prevent future Carding activity?

As with other fraudulent activity, there is no one thing to detect and prevent all Carding. We suggest implementing a layered approach, including the following features and activities:

  • Use a CAPTCHA: CAPTCHA (Completely Automated Public Turing test to tell Computers and Humans Apart) creates challenges to ensure that payment attempts are not sent by automated scripts or bots.
  • AVS responses:  The Address Verification System (AVS) checks the billing address that buyers provide at checkout against the address that the credit card company has on file for them. The credit card company sends a response immediately to let you know if the billing address matches. The common responses are:
    • Full address match
    • Address match only
    • Only the zip code provided matches
    • No information matches. The credit card company will not stop a transaction if the AVS response is No unless the card has been reported lost or stolen.Unfortunately, this can also create an issue of declines for your valid merchants, so it will require you to use discretion regarding the level of strictness you apply to this setting.
  • CSC/CVV responses:  The Card Security Code (CSC) or Card Verification Value (CVV) system checks the 3 or 4 digit number of the credit card and verifies it during the authorization processes. The common responses are:
    • Y-matched
    • N-does not match
      You should only accept transactions where the CSC/CVV matches.

Typically when credit card information is purchased illicitly it does not include CSC/CVV information.  Under PCI Compliance, the storage of the CSC or CVV number is not allowed, so when systems are hacked a credit card information is exposed, the CSC/CVV numbers are not available.

  • Velocity checks on your shopping cart:   Velocity is the number or speed of payments made within a certain period of time, for example, 10 payments sent from the same customer within seconds or minutes of each other. Monitoring this activity is important. Even with donation sites, it may be unusual for a user to make low dollar payments in rapid succession. Payment velocity can be monitored by dollar amount, user IP, billing address, BIN (Bank Identification Number which is part of the 16-digit card number), or device. Discuss this option with merchant service provider.
  • Shopping cart session velocity:  This refers to the number of times that one buyer can attempt to complete an order in one shopping cart session. By putting a limit on the attempts in one checkout session, you have visibility into the number of shopping cart declines which may assist in identifying a possible Carding situation.
  • Authorization/capture:  If you are using authorization/capture, review the transactions during the authorization period. If you believe that you are being targeted by Carding activity, do not capture the funds. If you have already captured the funds, you have the option to issue a refund rather than wait for a chargeback.  In this instance, issuing the refund is better than waiting for a chargeback since the chargeback fees can be $15.00 per transaction or higher.  Having a high number of chargebacks will also cause your Association to be “flagged” by Visa/MasterCard/AMEX and the banking system as being a target for fraud which makes you a higher credit risk.
  • Credit card BIN checks:  The Bank Identification Number (BIN) is the first six digits of every credit and debit card. Not only does it provide information regarding the type of card that is being used (Visa, MasterCard, American Express, or Discover), but it can also be used to find the name and location of the bank that issued that particular card. This information can be very important in detecting Carding. Typically, you should see a wide dispersal of cards with the same BIN. For instance, you may receive two payments from cards with the same BIN in a month; with Carding, especially if credit card information has been purchased online, you may receive ten payments from cards that have the same BIN, within a day or two. Tracking BINs may help identify this activity.

Talk with your merchant service provider, your AMS/LMS/Events Registration service provider, and/or your web developer.  See what solutions they recommend. A coordinated, proactive approach will ensure your Association will be in a better position to weather potential threats.

If you would like more information about how US Transactions Corporation helps Associations, please contact us directly at or



n.d. Credit Card Fraud Analysis. Accessed 12 9, 2019.

Reviewed by James Chen. 2019. Fraudulent Activity: Carding. April 9. Accessed 12 9, 2019.

n.d. What do I Need to Know About Carding Attacks, Prevention, and the Payflow carding prevention module?,-prevention,-and-the-payflow-carding-prevention-module-ts2243#what-is-carding.



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