As a merchant who processes credit cards, you may occasionally cross paths with a fraudster. A fraudster steals another individual's credit card number and uses it to make purchases. Most fraudsters will attempt to use a stolen credit card number before the card owner realizes it is stolen. Although there are a number of things you can do to protect yourself against fraudulent purchases, there are only a few ways to verify that the card is not stolen.

Request to see the customer's government-issued photo ID if it is an in-person transaction. When checking the ID, be sure that the name on the ID matches the name on the credit card.

Attempt to process the credit card by swiping it through a POS (point of sale) system or by obtaining authorization through a payment gateway. When a card is stolen, the owner of the card generally reports the card to the credit card company. The credit card company then places an alert on the card indicating that it is stolen. You will see this alert when attempting to process the card if the card has been reported stolen.

Call the telephone number that is on the back of the card. Advise the customer service representative that you would like to verify whether or not the credit card has been stolen. Provide her with the credit card number to verify the status of the card.

Request the CVC code that is on the back of the credit card. In order to get this code, the individual must have access to the credit card. If the individual cannot provide the CVC code, it is likely that he is attempting to use a stolen credit card number.