Sign Your Card, Damnit

I’ve worked in a retail store that has been prone to credit card fraud.  My wife used to work in credit card disputes.  My close friend works fraud.  And in all my years, there’s one thing I never understood — why people don’t sign the back of their credit cards.  I can be a stickler for rules, and there was a point in time where I tried to make people sign their cards before I would accept them — even if they wrote “See ID” on the back of the card — but I gave up on that because it ended up pissing off more people than I wanted to deal with.  Still, I never understood why people didn’t sign the back of their cards.  (If you’re one of those people that writes “See ID” on the back of your card, this post is for you.)

If you have a Visa or MasterCard-branded card, look at the back of your card.  Notice what it says there?  “Not valid unless signed.”  (Discover and Amex are more lenient — they don’t require you to sign your card.)  There’s a good reason for this — when you sign for a purchase, the retailer needs to be able to verify your signature against what’s on the back of the card.  By verifying the signature, the retailer can reasonably ensure that the person standing in front of them is the same person that signed the back of the card, and reduce the chances that they’ll have to eat the cost of a chargeback for a fraudulent transaction later.

This becomes even more important when you’re making a high dollar purchase — as the price of the purchase goes up, so do the chances that the transaction could be fraudulent.  There’s a good reason for that (which I’ll get into in a moment).

There’s a lot of people that choose, instead of signing the back of their card, to put “See ID” instead, in the hopes that the cashier will ask the cardholder for their ID and verify the signature on the ID.  Usually, the motivation for these people is that they’re afraid that someone is going to steal their card, practice their signature, then go to the store and sign for purchases using their own signature.  They fear that with the practiced signature, either a) the cashier won’t notice the difference between the genuine signature and the forgery, or b) the credit card company will deny that it was a fraudulent transaction because the signature is a spot-on match.  But here’s what’s wrong with that assumption:

First, the goal of a modern credit card thief is not to sit there and practice your signature until it matches yours.  Their goal is to visit as many stores as they can, as quickly as they can, and rack up as much on your card as they can before you discover that your card is missing and call it in to your card card company.  For the thief, the real money is not in getting a transaction to go through under the radar, it’s about translating your line of credit into something else that they can turn into cash later on.  Towards the end of my retail career, I was usually able to spot this behavior — thieves would come in, pick out a laptop (usually at random), go straight to the checkout, and try to get through the checkout and out the door as quickly as possible.  (However, I’m told that gift cards are the hot button item nowadays.)

Second, there’s nothing from stopping a thief from signing the card next to (or overtop of) your “See ID” mark.  There’s nothing wrong with signing a card and putting “See ID” in the signature box; but if you just put “See ID” in the signature box, you’re opening the door for the thief to make up a signature for you.  Guess what’s more spot-on than a thief who’s practiced your signature?  The thief who made up his own signature.

Third, just because a thief signed with your (practiced) signature doesn’t mean that it’s not still fraudulent.  In that same vein, signing with your own signature (on a purchase you made) doesn’t make the purchase any more valid.  Technically speaking, any sort of mark on the signature slip is a legal acceptance of the charge, regardless of whether it’s your actual signature or just an X.  (That’s right — the waitress at your favorite restaurant is actually signing for you when she puts an X on the charge slip to show you where you need to sign.)  The important part is whether the person who presented the card was authorized to make the purchase on your behalf — and if they weren’t, then it’s fraudulent.  Your credit card issuer will still reimburse you, even if it’s a thief that copied your signature.

The fact is that not signing your card just makes the transaction less secure, because it inserts more doubt into the merchant’s side of the equation.  If I have to ask you for your ID, how do I know that you’re the same person whose name is on the card?  Maybe you’re presenting me with a fake ID, or perhaps you got lucky and stole a card from someone with the same name as you.  If your signature is on the card, however, I can be reasonably sure that the person standing in front of me is the same one that signed the card.  In addition, when I was ringing up high-dollar purchases, I would frequently ask to see the customer’s ID, even if the signature was present on the card.  This would help me be even more sure that the person standing in front of me was the one authorized to use the card.  You know what’s more secure than verifying one example of your signature?  Verifying two examples.

So please — do retailers a favor.  Sign the back of your card.