| In this series we are going to cover one of the biggest | | | | codes. These are not encoded on the card strip but |
| problems all over the world. Credit card fraud. | | | | are physically written on the back of the card. This is a |
| For those who may not exactly know what credit | | | | required three digit code to finalize all transactions. |
| card fraud is, a simple definition. Credit card fraud is the | | | | Without this code even a cloned credit card will not |
| act of making a purchase using someone else's credit | | | | work. |
| card information. Sounds like something that should be | | | | Skimming at ATMs has also been a problem. What |
| difficult to do. Unfortunately, it's not. | | | | the illegally set up ATM machine does is place a |
| There are many types of credit card fraud, the most | | | | skimmer device somewhere in the machine that reads |
| common we'll cover in this article. | | | | the magnetic strip attached to the card. This is used |
| First there is what is called "mail non-receipt fraud" | | | | together with various devices that monitor the keypad |
| which is when a new or replacement card is sent by | | | | of the ATM by attaching a fake fascia over the |
| the bank and never received by the person it was | | | | original keypad. Fortunately, this is not as common |
| supposed to go to. This has been mostly combated by | | | | today as it was years ago when ATM machines |
| the banks sending out inactive credit cards where the | | | | were relatively new. |
| person has to make a phone call in order to activate | | | | Then of course there is "online credit card fraud" which |
| the card. Otherwise it can't be used. Unfortunately | | | | is the most common type of credit card fraud today |
| there are some banks that do not do this and still send | | | | with all the transactions that people do each day. This |
| out cards that are already activated. | | | | type of fraud gets a little complicated but simply |
| Then there is what is called "chargeback fraud" where | | | | stated, when a person uses their credit card online, |
| a legitimate cardholder uses the card to purchase | | | | hackers monitor the person's entry into the merchant's |
| goods or services. Then when the statement comes | | | | system and essentially steal the credit card information |
| they call the credit card company and claim they | | | | without the person having any idea this is happening. |
| never received the item or service or that they never | | | | Another way to get a person's credit card info online is |
| authorized the transaction. | | | | to send an official looking email telling the person that |
| Another type of credit card fraud is called "skimming" | | | | they have to update their credit card info. They are |
| where an employee or merchant makes a second | | | | sent a bogus link to go to where the info is collected |
| copy of the person's credit card details before | | | | and used for whatever purpose the scammer wants, |
| processing the payment. This copy is then sold on the | | | | whether to sell the info or use it to make purchases |
| black market to professionals who clone illegal copies | | | | himself. |
| of these cards. Fortunately, skimming has become less | | | | In the next article in this series we'll go into credit card |
| of a problem since the introduction of CVV and CVS | | | | fraud into more depth. |