Credit Card Fraud - Part II

In this issue of our series on credit card fraud we're going to delve a small deeper into some facts and figs that volition most certainly raise the hair on the dorsum of your neck.

In apparent dollars and cents, a single credit card fraud can, and has, accounted for about forty-million dollars in just one twelvemonth alone. That translates to about 900,000 victims in 22 countries. That's a batch of people and a batch of money and that's just ONE fraud. For those wondering, this peculiar fraud involved grownup 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 full human race with just a mouse chink and attack thousands of people in a very short clip period of time. The Internet have simply given a very old cozenage new legs. It have brutally exposed the security problems with our credit card system and takes advantage of these leaks to the max.

The peculiar fraud mentioned up top was perpetrated by a company called Joule Kelvin Publications. If you desire to read about the inside information of this fraud you can make so in the August 1999 issue of Scientific American. Needless to say, it is some juicy reading.

So just where makes the money travel when a company or merchant or even individual perpetrates a credit card fraud? Well, if the fraud travels undetected in most cases the money travels to the merchant himself with the center man, if there is one, usually getting paid a cut, if for no other ground than to do certain he maintains his oral cavity shut. In some cases the money travels to the merchant and the bank. Yes, there are some crooked banks out there, especially overseas in states that volition stay unidentified for fearfulness of gun toting mobsters being sent over here to settle down a score.

If, however, the fraud IS detected then the money makes get repaid to the victim but in most cases less than the under $50 amount that the banks have got to pay. In other words, the victim doesn't completely come up away from this unscathed. Many European banks won't pay up at all. As for the merchant account, they don't desire to endure losses, so many modern times they will simply just fold 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 purchasing physical commodity with the card holder being physically present. With Internet transactions the cardholder no longer have to subscribe for the transaction, at least not in the usual way, and this make it manner too easy to beat the system.

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