Shops blow signature test

Courtney Dixon was one of the few retailers to check credit card details. Photo / Herald on Sunday

Most retailers are failing to make even the most basic checks to prevent credit card fraud, according to an undercover survey.

A Herald on Sunday representative visited 20 Auckland stores this week and at 16 - 80 per cent - made purchases using a card that didn't belong to her.

New Zealand Retailers Association chief executive John Albertson said the results were "very disappointing", particularly during the pre-Christmas rush.

The findings come despite repeated security warnings from banks and credit card companies on the doubling in fraud cases since 2005.

Our representative visited 10 stores in downtown Auckland and 10 at the St Lukes mall. She attempted to make purchases of about $5 using a colleague's National Bank Visa card and made no attempt to copy the signature on the card.

Staff at 16 stores, including some of our top chains, failed to question the conflicting signatures and allowed the purchase.

Most gave the signatures a cursory glance at best, while a few looked suspicious but still let the purchase through.

One retailer joked with a workmate about the obviously different signatures and said: "I wonder what would happen if we didn't let it through?"

Some only compared the signatures after the sale was already completed, while one didn't look at the card at all.

A National Bank spokes-woman was disappointed with the results.

"All merchants have guidelines for the acceptance of credit cards and are expected to ensure the customer signature is verified," she said.

Visa New Zealand manager Sean Preston said merchants were responsible for checking that signatures matched and he was "concerned that the proper procedures weren't carried out in this instance".

But he said it was important to note that cardholders were not held liable for losses in the event of fraud.

Courtney Dixon, manager at Equip in St Lukes mall, was among the minority who followed correct procedures and pulled us up on the conflicting signatures.

Dixon said she trained her staff to check signatures and they questioned people "all the time".

"There's no reason why people should get away with it. If the signatures don't match we get them to sign again or ask to see photo ID. I always get staff to check expiry dates as well."

Upmarket department store Smith & Caughey's was among the businesses that failed the test.

Executive director Terry Cornelius was "very surprised" that his staff didn't pick up on the non-matching signatures.

"We train all our staff in the correct procedures for credit card transactions and we will be reminding staff to check signatures," he said, adding that security cameras were in place to record fraudsters' identities.

We also managed to make a fraudulent purchase at Food-town St Lukes.

A spokeswoman from Foodtown's parent company, Progressive Enterprises, said the incident was unfortunate. "We will be reviewing our processes to protect our customers and our staff going into this busy shopping period," she said.

Kmart St Luke's manager Steve Walker was also disappointed one of his staff had allowed the fraudulent transaction.

He thought the slip-up could be down to the rarity of credit card transactions using signatures at the store.

"Ninety-five per cent of credit card transactions are with PINs now, but it's still a requirement to do a signature check and we train staff to do that."

Albertson said he thought an influx of pre-Christmas casual staff could be partly responsible for the results.

"The only way to keep theft and fraud down is to make sure all staff, no matter if they're working one day a week or five days a week, have the appropriate training and understand what they have to do."

He said the low cost of the purchases may have contributed to the retailers' complacency, but that was no excuse.

"More often or not, on a purchase of that size people would put it on eftpos, not credit."

Police offer retailers a range of tips on how to avoid falling prey to credit card fraudsters.

They include carefully checking that the signature on the receipt matches the one on the card, the signature panel hasn't been altered, the name on the card matches the gender of the presenter and the expiry date is valid.

* How they stacked up

PURCHASE SUCCESSFUL

Bond & Bond (St Lukes)
Cotton On (Queen St)
Foodtown (St Lukes)
Jay Jays (Queen St)
JB Hi Fi (Queen St)
Kikki K (Queen St)
Kmart (St Lukes)
Life Pharmacy (St Lukes)
Living & Giving (St Lukes)
Maten Floral Design (St Lukes)
Pumpkin Patch (High St)
Smith & Caughey's (Queen St)
Supre (Queen St)
The Body Shop (Queen St)
The Warehouse (Downtown)
Whitcoulls (Queen St)

PURCHASE DENIED

Equip (St Lukes)
Farmers (St Lukes)
Glassons (St Lukes)
Hallensteins (St Lukes)

- HERALD ON SUNDAY