[michaelt]

  Card issuers are often able to detect
  that a transaction is fraudulent before
  it is disputed, and when this happens,
  they will send us a notification.

Is there a mechanism like that but in the reverse direction? i.e. if a seller detects someone testing stolen cards, and wants to alert the card issuer all those cards are stolen?

[michaelmior]

Shouldn't the issuer be able to figure this out on their own when they see the attempted charges coming in? It seems like the resources of the issuer would be better spent improving their own detection rather than dealing with third-party reports.

[michaelt]

Retailers might enjoy better information (account history, items in basket and suchlike), might have already borne the cost of manually checking the order, or might have better incentives (as it's them who loses money if an order was placed with a stolen card)

After all, if the issuer had been able to figure it out, the payments would have failed preauthorisation.

[jacquesm]

Too much abuse potential, for instance, a software error could flag 'good' cards as 'bad' and cause a lot of headaches for other merchants.

[MichaelApproved]

I think Strip has a report fraudulent transaction feature. I've had someone do several $1 test charges on a donation page for a charity I managed. I was able to report the approved cards as fraudulent transactions.

This was many years ago. At the time, I think it was a beta feature so I'm not sure if it's been rolled out to everyone yet.