TC40 Fraud Report

A TC40 fraud report is a Visa record created when an issuer identifies a transaction as fraudulent. The label comes from the transaction code Visa uses for fraud reporting, and the record's role is to capture fraud information in the payment system — separate from, and often earlier than, any dispute that might follow. It documents that fraud was reported on a transaction; it does not, by itself, move any money.

The most important thing to understand about a TC40 is what it is not. It is not a chargeback. A chargeback is a financial reversal processed through the dispute system, while a TC40 is a fraud-reporting entry. A single transaction can generate a TC40 report and never become a chargeback, can become a chargeback without a corresponding TC40 report, or can produce both. Because of this separation, TC40 activity often exists in a merchant's fraud profile before anything shows up in the chargeback numbers.

That timing is exactly why TC40 reports matter for monitoring. Visa uses fraud data, including TC40 reports, as part of its programs, and TC40 counts contribute to the VAMP Ratio alongside dispute records. A merchant that tracks only chargebacks can be closer to a monitoring threshold than it realizes, because the fraud side of the equation is accumulating out of view. Visibility into TC40 activity closes that gap.

Handled well, TC40 reports become an early-warning tool rather than a hidden liability. Merchants reconcile them against disputes and transactions so fraud is not double-counted, and they use the signal to act — sharpening fraud screening, halting shipments on flagged orders, or investigating a suspicious pattern. TC40 is also distinct from the TC15 dispute record: one identifies fraud, the other identifies dispute activity, and treating them as interchangeable obscures the picture that monitoring programs actually measure.

TC40 fraud reports matter because they count toward Visa monitoring even when they never appear as chargebacks. A merchant that watches only its chargeback numbers can miss a rising fraud problem that is already accumulating in TC40 data and feeding its VAMP Ratio.

Because a TC40 report signals confirmed or suspected fraud, it is also an early operational cue. Acting on the underlying activity — tightening fraud controls, stopping fulfillment, or investigating a pattern — can prevent both future fraud and the disputes that often follow.

Issuers create TC40 records when they identify a transaction as fraudulent, and Visa uses that fraud data as part of its monitoring, including in VAMP-related calculations. Merchants and acquirers use TC40 visibility to understand fraud exposure that sits outside the chargeback stream.

Practically, merchants reconcile TC40 reports with disputes and transactions so a fraud report is not double-counted against a related chargeback and so fraud trends are visible across channels rather than hidden in a single processor's view.

A TC40 fraud report is not itself a chargeback. It is a fraud-reporting record created by the issuer, and a transaction can generate a TC40 report without ever becoming a chargeback — or can generate both. A TC40 report is also not interchangeable with a TC15 dispute record: TC40 identifies fraud, while TC15 identifies dispute activity. Whether and how a TC40 report factors into monitoring calculations is governed by current Visa program rules.