I was going through my receipts from the weekend when I ran across one from a restaurant. It wasn’t unusual to see the tip and total amounts filled in as I usually do that to both the copy I leave on the table and the copy I take home. What was unusual was that it also had my signature.
I had accidentally taken both copies of the itemized receipt.
Worried that by taking both the merchant and customer copies of the receipt I had skipped out without paying, I quickly called the restaurant and summarized the situation to a manager. He said that it wasn’t a problem because the amount of the check had been charged to my account when they swiped my card. Our server, unfortunately, would not get the intended tip since we had not left any indication of how much tip we wished to leave.
I had always been under the impression that the signature for a purchase was required for the transaction to be completed. After doing some research, it turns out that’s simply not true.
The Blame Game
All the signature does is help resolve who will eat the cost if there’s a scenario where fraud is in play. If a customer reports unauthorized use of their card and no signature was requested, then the merchant eats the cost. If fraud is reported but there is a signature, even if it’s signed by Mickey Mouse, the bank generally takes the loss because the merchant has shown they made an effort at validating the identity of the purchaser.
No Signature Required
The purchase is actually authorized as soon as the card is swiped, or in the case of cards with the new payment chip, as soon as the chip is scanned. Merchants are generally free to make their own policies regarding when they require a signature. Many merchants will forego the signature and not require one for smaller amounts because they believe the risk is small for fraud on low priced items. Others will not only require a signature but also force you to present ID to match the signature for every single purchase.
Fraud Doesn’t Pay
With this information, someone may get the idea to buy a bunch of stuff, not sign the receipt, and then report fraudulent use of their card. Because there is no record of their signature, a person might think that the charges will be reversed and someone else (the merchant most likely) will have to swallow the cost of the item. Unfortunately for our example criminal, there will likely be a security camera that captures the transaction on film.
Next time you buy something with your credit card, observe whether a signature is required. If it is required, try signing it illegible or with a completely different name. Chances are, the cashier isn’t looking because the merchant is going to get their money anyway.
Have you ever accidentally left the scene of a transaction without signing for your purchase? Did it go through? How much was it for?
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