Credit Card Fraud - Part II

In this issue of our series on credit card fraud we're going to dig a little deeper into some facts and figures that will most certainly raise the hair on the back of your neck.

In plain dollars and cents, a single credit card fraud can, and has, accounted for about forty-million dollars in just one year alone. That translates to about 900,000 victims in 22 countries. That's a lot of people and a lot of money and that's just ONE fraud. For those wondering, this particular fraud involved adult web sites, but credit card fraud was going on long before the Internet came to be.

What IS new is the ability to run this fraud across the entire world with just a mouse click and attack thousands of people in a very short period of time. The Internet has simply given a very old scam new legs. It has brutally exposed the security problems with our credit card system and takes advantage of these leaks to the max.

The particular fraud mentioned up top was perpetrated by a company called J K Publications. If you want to read about the details of this fraud you can do so in the August 1999 issue of Scientific American. Needless to say, it is some juicy reading.

So just where does the money go when a company or merchant or even individual perpetrates a credit card fraud? Well, if the fraud goes undetected in most cases the money goes to the merchant himself with the middle man, if there is one, usually getting paid a cut, if for no other reason than to make sure he keeps his mouth shut. In some cases the money goes to the merchant and the bank. Yes, there are some crooked banks out there, especially overseas in countries that will remain nameless for fear of gun toting gangsters being sent over here to settle a score.

If, however, the fraud IS detected then the money does get repaid to the victim but in most cases less than the under $50 amount that the banks have to pay. In other words, the victim doesn't completely come away from this unscathed. Many European banks won't pay up at all. As for the merchant account, they don't want to suffer losses, so many times they will simply just close up and reopen under a new name.

Because the system itself is weak, the thieves themselves are rarely caught, and then when they are, they rarely get punished to the extent that they should. The problem with the system is that is was designed for buying physical goods with the card holder being physically present. With Internet transactions the cardholder no longer has to sign for the transaction, at least not in the usual way, and this makes it way too easy to cheat the system.

In our next article in this series we'll look more into the problems of the system and what victims of fraud can do to help protect themselves, or for that matter prevent themselves from being the victim of credit card fraud.

Credit Card Fraud - Part I

In this series we are going to cover one of the biggest problems all over the world. Credit card fraud.

For those who may not exactly cognize what credit card fraud is, a simple definition. Credit card fraud is the enactment of making a purchase using person else's credit card information. Sounds like something that should be hard to do. Unfortunately, it's not.

There are many types of credit card fraud, the most common we'll cover in this article.

First there is what is called "mail non-receipt fraud" which is when a new or substitution card is sent by the bank and never received by the individual it was supposed to travel to. This have been mostly combated by the banks sending out inactive credit cards where the individual have to do a phone phone call in order to trip the card. Otherwise it can't be used. Unfortunately there are some banks that make not make this and still direct out cards that are already activated.

Then there is what is called "chargeback fraud" where a legitimate cardholder utilizes the card to purchase commodity or services. Then when the statement come ups they name the credit card company and claim they never received the point or service or that they never authorized the transaction.

Another type of credit card fraud is called "skimming" where an employee or merchant do a second transcript of the person's credit card inside information before processing the payment. This transcript is then sold on the achromatic market to people who clone illegal transcripts of these cards. Fortunately, skimming have go less of a problem since the introduction of CVV and curriculum vitaes codes. These are not encoded on the card strip but are physically written on the dorsum of the card. This is a required three figure codification to finalize all transactions. Without this codification even a cloned credit card will not work.

Skimming at ATMs have also been a problem. What the illegally put up standard atmosphere machine makes is topographic point a skimmer device somewhere in the machine that reads the magnetic strip attached to the card. This is used together with assorted devices that monitoring device the computer keyboard of the standard atmosphere by attaching a fake facia over the original keypad. Fortunately, this is not as common today as it was old age ago when standard atmosphere machines were relatively new.

Then of course of study there is "online credit card fraud" which is the most common type of credit card fraud today with all the transactions that people make each day. This type of fraud gets a small complicated but simply stated, when a individual utilizes their credit card online, hackers supervise the person's entry into the merchant's system and essentially steal the credit card information without the individual having any thought this is happening. Another manner to get a person's credit card information online is to direct an functionary looking electronic mail telling the individual that they have got to update their credit card info. They are sent a fake nexus to travel to where the information is collected and used for whatever intent the swindler wants, whether to sell the information or usage it to do purchases himself.

In the adjacent article in this series we'll travel into credit card fraud into more than depth.

Moving Debt Between Cards Can Save You Money

If you're wish most people, you have got got plenty of credit cards, and you have tons of offers for more. The credit card industry is so competitory that, whatever card you have, the opportunities are that somewhere out there is one that would be cheaper or better for you - and you can change as often as you want!

Take Up Teaser Offers.

To seek and get customers, credit cards are still offering monolithic price reduction rates when you transfer balances over to them. These 'teaser' rates will only last for a set clip period (check the terms and conditions), but they can still salvage you a batch of money - especially if you switch over to another card's teaser rate each time 1 ends.

Yes, this makes average applying for a new card relatively often - but if you make it online, you'll happen it's quite painless. Are it really deserving 100s of dollars to salvage the problem of applying for a new card?

Extend Your Offers.

You might not even need to travel to another card to get a teaser offer for longer. If you phone and ask, many lenders will widen the discriminatory rate for longer, in an attempt to get you to lodge around.

Check the Small Print.

You might happen that the 'low, low rate' lone endures a few months, and you might also happen that it only uses to balance transfers, not new purchases. A common trap is for a card to allow you to transfer your balance of thousands at 0% APR, only to charge you 20% Oregon more than on anything new you purchase with it. Of course, as soon as you ditch that card and move to the next, the new purchases go a balance transfer again.

A more than than awful thing you might happen is that you're signing up to a minimum term to get the teaser offer - they won't allow you transfer your balance away again for a year, or even more. Avoid these cards like the plague.

Keep Path of Time.

Your card issuer isn't going to travel out of their manner to alarm you when your teaser rate is over. Brand certain you maintain track: do a grade on the calendar. Months can travel by far more than quickly than you'd think, and lacking the stop of the teaser time period by even a twenty-four hours will intend that you'll end up paying interest at the normal rate.

Moving Around and Your Credit Rating.

Moving debt around between cards often impacts your credit evaluation in an odd way. On the 1 hand, it demoes that you could be an unprofitable client - after all, you change cards before they can do a net income from you. On the other hand, it also demoes that you're likely to take up offers that you're sent, and companies be given to believe that they have got got a great strategy to maintain you with them where others have failed.

In other words, some companies volition detest you for it, and some will love you. Bear in mind, though, that the longer you make it for, the fewer companies will desire to direct you their very best teaser rates.

Avoiding Credit Card Fraud

Imagine the following situations:

Someone rummages through your rubbish to find discarded receipts and then uses your account numbers illegally.
A shop keeper keeps a copy of your credit or debit card and then uses it to pay for other transactions.
A mailing asks you to call a long distance number to claim a free prize. You are told to provide your account number to sign up. You do so and are billed for transactions you never made.

Credit and charge card fraud is a huge industry costing consumers and card issuers hundreds of millions of pounds each year. It is a form of theft that is much more discrete than traditional robbery. While it is difficult to completely prevent card fraud from occurring, there are steps you can take to minimize your chances of becoming a victim.

Guard Against Fraud

Here are some tips you can take to help protect yourself from card fraud.

Do:

Sign the back of your cards as soon as they arrive.
Carry your cards separately from your wallet.
Keep your account numbers, expiry dates and company phone numbers and addresses in a safe place.
Watch your card while it is out of your sight during a transaction and seek to get it back quickly.
Destroy incorrect receipts and all carbons.
Compare receipts with your monthly billing statements.
Open your bills and reconcile your account monthly.
Report suspicious activity or charges promptly and in writing to your card issuer.
Notify your card issuer in advance of a change of address.

Don’t:

Lend your card to anyone.
Leave your cards or your receipts lying around where others might find them.
Sign blank receipts. If there are blank spaces on a receipt, draw a line through them.
Write your account number on the outside of an envelope or on a postcard.
Give your account number over the phone, unless you have made a call to a company you trust. If you have a question regarding a company, check it out with your local consumer protection office.

Report Losses and Fraud

If your card is stolen or lost, report this immediately to the issuer immediately. Many companies have free emergency numbers specifically for such calls. By law, you have no further responsibility for unauthorized charges once you have reported it. Calling quickly will reduce your liability for unauthorised charges, and will help the card issuer to catch the fraudster or block the transactions, making life harder for the crooks.

General Tips on Credit Cards

Credit card or plastic money is ubiquitous today. Today they are treated as more than of a necessity than just a commodity. Thus it is indispensable that you not only utilize them properly but also take proper care of them. The following listing is a digest of some tips on credit card management:

1. Never chose a peculiar credit card because your friend or person else have chosen it. Instead basal it on your needs.

2. Compare assorted credit cards before arriving at the right 1 for you.

3. Always mark at the dorsum of your credit card, as soon as you have it. This is an of import credit card protection mechanism.

4. Protect sensitive information/details about your credit card e.g. PIN. Never uncover the inside information to anyone.

5. Destroy any mails containing such as the inside information about your credit cards. Fraudsters might be scanning your garbage for such as information.

6. Bash not share your credit card with friends, household and others. Apply for supplementary cards if you necessitate one for your household etc.

7. Never use more than than 75% of your credit limit. This volition aid in containing your credit card debt and also in maintaining a good credit rating.

8. Be on time in your payments. If you haven’t received your monthly bill, enquire with your credit card supplier. Non-payments and late payments maculate your credit rating.

9. Never allow your credit card travel out of your sight.

10. There is no magic wand for debt elimination. So return measurements for getting out of your credit card debt. This includes things like controlling your credit card usage, using cash on some occasions, debt consolidation etc.

11. In lawsuit your credit card gets lost or is stolen. Immediately inform (call) your credit card provider to get it invalidated. Keep this phone number separate from your credit card.

12. Be on time in advising the change of computer address to your credit card supplier.

13. Be aware of assorted offers / dismisses that accompany your credit card. You never cognize when one might turn out utile to you.

14. Bash not error credit card for free money or a lottery. Remember that you will have got to pay for it. So always lodge to your budget.

15. Check if one of the particular credit cards e.g. student credit card, small business credit card is better for you.

16. Always read all the instruction manual supplied with your credit card especially the 1s related to fee/commissions etc.

17. Deliver rank rewards in time. Don’t allow the points get expired. Never go forth them unutilized when shutting your credit card account.

18. Take professional advice if you are too deep into credit card debt.

19. Never get lured by all the free offers on your credit card and end up disbursement thousands of vaulting horses just to recognize later that you can’t actually pay it back in time.

20. Never apply for too many credit cards just for manner sake. Even you don’t usage them you might still be paying annual fees and them and moreover why maintain something you don’t need.

Protect Yourselves Against Fraud

As with every financial instrument, there are credit card related frauds too. There are thieves who scan through rubbish to derive access to credit account related information and then utilize it for their benefit. Once in a piece there could be a unreliable individual at the till of a shop or at the payment counter of a local restaurant. Even simply, your card could get stolen and set to fraudulent use.

Whatever the possible ways of fraud is, we are just concerned with ensuring that we have got all the guards in topographic point so as to minimise the possibility of fraud occurring with us. Such safe guards are generally provided by all credit card companies as instruction manual to new card holders. Let's return a snapshot of what the most suggested precautions are:

1. Always mark at the dorsum of your credit card, as soon as you have it. This is an expressed direction from credit card companies to all card holders and is an of import agency of establishing identity.

2. Keep the inside information about your credit card and company in a secure topographic point and separate from your credit card. In lawsuit your card gets stolen or misplaced, immediately inform the credit card company about it. All credit card companies have got dedicated 24x7 lines for receiving such as information. As soon as this information is received by the company, it barricades the card so as to forestall subsequent abuse of the same.

3. Keep your credit card separate from your wallet so that if a cutpurse demonstrates his/her accomplishment on you pocket, you are not stranded owed to no-cash and no-card. As the expression goes, never maintain all your eggs in the same basket.

4. Never go forth your card unattended and maintain an oculus on your card whenever conducting a transaction, just to guarantee that it's not being misused or copied. It's important to advert here that there are electronic devices which are being used by fraudsters to easily recover information from your card for the intent of creating a reduplicate card.

5. Destroy any mails/posts that incorporate your credit card details. Don't bin them as-is. Remember, there could be rubbish scanners on the prowl.

6. 'Change of address' communication theory should be made promptly and in advance.

7. Always check your monthly statement and verify its correctness, instead of ignoring them as a batch of people do. In lawsuit you happen anything amiss, immediately inform the credit card company about the same.

8. Also, avoid doing credit card transactions with stores or companies of sick repute.

9. Bash not uncover your account inside information over internet or phone, even if the company on phone or the electronic mail in your inbox looks to be from your credit card company. Fraudsters can sometimes present as the credit card company itself and seek to extract inside information about your card (including the pin number). Also, online or on-phone shopping with companies you are not certain of is a big-big no.

Though there is nil fillet you from possessing and using a credit card, the above-stated precautions should always be borne in mind.