What is a Hot List?
How Does a Hot List Work?
For example, let's assume that John's wallet is stolen. He calls MasterCard to report the theft, and the company places his number on its hot list -- an electronic list maintained by MasterCard and linked to all the merchants who accept MasterCard.
Later that day, a $5,000 transaction at Nordstrom appears on the credit card. The sales associate retains the card because the point-of-sale (POS) terminal quickly matches the card number to the number MasterCard placed on its warning bulletin. The sales associate then follows company policy regarding such situations -- this might include keeping the card and calling the police.
Why Does a Hot List Matter?
Credit card fraud costs businesses and individuals billions of dollars a year -- at least $8.6 billion, according to one study. Due to the sheer number of credit cards out there and the massive number of transactions that occur every day, credit card processors need a way to communicate lists of lost, stolen or compromised card numbers quickly and efficiently. The hot list is one such method.
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