Tuesday, June 6, 2023

How To Commit Credit Card Fraud

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How Do I Report Credit Card Fraud


The process for reporting credit card fraud depends on the type of fraud. If you spot fraudulent purchases on your card, you can report them to your issuer. You can easily report credit card fraud to your card issuer through its website or mobile app. Of course, you can also call the number on the back of your card.

If the credit card fraud involves unauthorized accounts opened in your name, there are two steps you need to take. First, contact the card issuer and alert them to the fraudulent account. You can usually do this online or by phone.

Next, contact the credit bureaus and report the credit card fraud by disputing the account. You’ll need to file an account dispute with each credit bureau — Equifax, Experian, and TransUnion. Identity theft should also be reported to appropriate legal authorities, including the Federal Trade Commission . Check identitytheft.gov for help reporting identity theft.

Crooks Take Advantage Of Pandemics

Fraudsters dont let an opportunity go to waste, and that includes situations where the country has shut down and consumers are vulnerable. The dollar amount of attempted fraudulent transactions rose 35% in April 2020 in the midst of the global pandemic according to the Fidelity National Information Services Inc., a banking fraud detection company.

Remedy: The primary reason for the uptick in credit card fraud during a shut-down is increased online shopping. So, make sure you only use your credit card on trusted and secure websites. Never click on emails and texts from retailers offering promotions and instead go directly to the company websites.

Before entering your credit card account information to make the purchase, look at the web address in the browser bar. It should start with https and include a gray padlock symbol. If it doesnt, the e-commerce site isnt secure, and your data can be more easily pilfered. And avoid shopping from public wifi hotspots, because your information can be grabbed by someone else on the network.

People Worry More About Identity Theft Than Murder

According to the latest Atlas VP research, U.S. consumers are far more worried about their identity being hacked than they are of getting murdered. The primary reason for this concern is the high number of data breaches and the prevalence of hacking as well as the feelings of vulnerability.

Remedy: Maintain perspective! Yes, you may very well be hit by a fraudster, even after doing your best to protect yourself against it, but all the damage that a person can cause is fixable.

You wont have to pay for a crooks charges, you can purge your credit report of false information, and take even stronger measures against fraud making it even more unlikely to happen again.

It can take time and energy, but the fact is you can overcome credit card fraud. Compared to bodily harm or untimely death, there is no comparison.

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Counterfeit Doctored Or Faked Cards

Devices known as skimmers can illegally obtain credit card details. These machines capture information from the credit card’s magnetic strip, which the criminal can then encode into a counterfeited, faked, or doctored card. It might be hard to detect the difference between a regular card reader or ATM and one with a skimmer attached to it.

How Crooks Collect And Test Credit Card Numbers


How do criminals collect and then test credit card numbers? The sad fact is that there is no shortage of methods by which fraudsters can scam people out of sensitive financial information.

This isnt limited to payment card information like the 16-digit number, CVV, and expiration date either. Some scammers might collect a victims bank account information to make direct money transfers using that account number.

Here are a few ways that fraudsters might illicitly collect financial information:

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Detecting And Fending Off Credit Card Fraud

It’s possible to detect credit card fraud early by routinely checking for signs of shady activity on your credit accounts:

  • Review your card statements monthly, whether you get them online or in hard-copy form, looking carefully for unexpected purchases or cash advances. If you see any unfamiliar purchases, contact the card issuer immediately to dispute the charges.
  • Check your credit reports from all three national credit bureaus . You can download your reports for free at AnnualCreditReport.com. Once you have your reports, look for unfamiliar inquiriesand loan or credit card accounts that you didn’t open. If you see any credit report entries that look fishy, use the contact information in the credit report to notify the creditor in question. They can give you more information, begin an investigation and may ultimately notify the credit bureaus to remove the account. You can also file a credit report dispute if you believe there are inaccurate entries on your credit reports.

If you suspect you have been the victim of identity theft, consider visiting the Experian Fraud Center to place a free fraud alert on your credit report. When a fraud alert is in place, potential new lenders are asked to verify your identity before issuing any new accounts in your name. You only have to contact one credit bureau to have a fraud alert put in place on all three of your credit reports. You can cancel the alert at any time.

How To Report Credit Card Fraud

You should report any fraud on your credit card by:

  • Use Action Frauds online tool to report the crime, or call them on .
  • You can also report financial scams, such as investment fraud, to the Financial Conduct Authority
  • You should also contact credit reference agencies: TransUnion Equifax Experian – if someone has applied for a credit card in your name.
  • Contact the Royal Mail Customer Enquiry Number on if you think your post is being stolen or redirected without your permission.
  • Contact the issuing organisations for any lost documents like passports or driving licenses.
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    Common Types Of Credit Card Scams & Fraud

    Credit card fraud comes in many different shapes and forms, including fraud that involves using a payment card of some description, and more. The reasons for credit card fraud also vary. Some are designed to obtain funds from accounts, while others wish to obtain goods for free. Furthermore, it is very important to understand that credit card fraud is linked closely to identity theft. According to the Federal Trade Commission, some 5% of all people over 16 in this country have been or will be the victim of identity theft. Additionally, at the last count in 2008, it was found that there had been a 21% growth in prevalence of identity theft. On the other hand, the percentage of identity theft cases related to credit card fraud decreased, which is a positive thing and a credit to law enforcement professionals and the general public as a whole.

    In fact, it accounted for 45 percent of in 2014, followed by counterfeit card fraud and lost/stolen cards . The total value of card-not-present transactions is expected to grow from $9 billion in 2013 to nearly $19 billion in 2018, as fraud at the point of sale shrinks. Sep 16, 2015

    Featured Graphic

    But credit card fraud is not just one single action. In fact, there are many different forms out there. It is important to remember that there are more, particularly as hackers and identity thieves are becoming more proficient at taking peoples financial data online.

    Below are the 11 most common forms of credit card fraud.

    What Are The Types Of Credit Card Fraud

    credit card fraud made easy

    You can break down the various types of credit card fraud into four main areas:

  • Lost or stolen cards are used without their owners permission.
  • Card details card number, card holder name, date of birth and address – are stolen, often from online databases or through email scams, then sold and used on the internet, or over the phone. This is often called card-not-present fraud.
  • Committing fraudulent applications in someone elses name for a new credit card, without that person knowing.
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    Investigating From The Merchants Perspective

    Lets switch the page to the Suspicious transactions tab.

    Well, its not really necessary to have the dashboard displaying transactions in real-time for merchants. But just to let you know, atoti is able to reflect the data upfront almost instantly upon loading.

    We can zoom into a specific merchant chain to see if there are certain outlets that are having higher fraud counts than other outlets.

    Also, we can see if a certain consumer has multiple fraudulent transactions with the same merchant. If we have refund information in the dataset, we could even see if the same consumer has repeated refunds, which may suggest chargeback fraud.

    In the event the business management team is interested to see how these outlets are spread across geographically, we have enough information to provide this information upfront :

    The Best Tips For Credit Card Dispute Fraud Prevention

  • Do Credit Card Networks Like Visa Investigate Credit Card Disputes?
  • When a cardholder contacts their bank to dispute a credit card charge, it’s the merchant who ends up paying the price. In addition to the funds lost due to the transaction being reversed, there’s also the chargeback fee and other related costs to consider. When all is said and done, the merchant can end up losing twice the original transaction amount.

    What’s worse is that many of these disputes are illegitimate. Chargebacks can only be filed for a very limited set of reasons, most often in cases of true fraud. Unfortunately, cardholders often file illegitimate disputes either out of ignorance or malice. These disputes are often referred to as credit card dispute fraud, chargeback fraud, or friendly fraud. Let’s take a look at some common causes of fraudulent disputes and what merchants can do to identify and fight them.

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    Discussing How Credit Card Fraud Is Committed

    Have you been defrauded of your credit card information? How did you find out about it, and what did you do? Recent reports indicate that business losses due to credit card fraud could reach an overwhelming amount of $20 billion by next year.

    The biggest cause of these losses is identity theft whereby a fraudster poses as the owner of the credit card when calling the credit card company, and is able to provide all the right information regarding the card owners identity, and gets an approval for various transactions, often in huge amounts.

    Why Does Credit Card Dispute Fraud Happen

    All You Need To Know About Credit Card Fraud

    Issuers are required to give cardholders the right to dispute a credit card charge when a third party uses the card without the cardholders permission, or when the merchant makes an error or refuses to honor their agreement with the customer.

    In the latter case, the cardholder is ostensibly required to make a good faith effort to work things out directly with the merchant, but not every issuer is equally strict about enforcing this rule and thats one of the big loopholes that allows credit card dispute fraud to occur.

    For cardholders, there are few downsides to asking for a chargeback, even if they have to stretch the truth to justify it to the bank. Usually, the worst-case scenario is that the merchant successfully represents the charge and they dont get their money back.

    Savvy merchants may blacklist the cardholder from shopping with them again, but the consequences rarely get harsher than that. While banks will sometimes close accounts that repeatedly abuse the dispute process, criminal prosecution for credit card dispute fraud is uncommon .

    The result is that many customers see chargebacks as one of many acceptable options when it comes to resolving an unsatisfactory purchase. An extremely common scenario is family fraud, where a family member, often a child, makes a purchase on the cardholders card without their permission.

    Because dispute fraud is hard to prove and sporadically penalized, cyber shoplifting is a growing problem for many merchants.

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    How Does Fraud Happen On Credit Cards

    Fraud can occur when thieves get either your credit card data or your physical credit card. For example, credit card fraud happens when criminals acquire your credit card information or your account login information.

    Common ways fraudsters get your credit card information include theft and scams. For example, a thief may steal your mail or get old documents from your trash. Your physical credit card can be stolen. Your card can also be copied via a skimmer or scanner. Thankfully, chip credit cards have reduced the amount of fraud from copied credit cards.

    Phone scams are also common. Fraudsters may pretend to be a bank or government agent and demand your account data. Other scams can include complex fronts like fake charities or counterfeit businesses.

    Another common type of credit card fraud happens when your identity is stolen. Identity thieves can use your personal information to open credit cards in your name. They can then rack up debt on the cards and disappear.

    What To Do If You’re The Victim Of A Credit Card Scam

    As soon as you know you’ve been scammed, report it. Dispute any fraudulent credit card transactions with your issuer. You can do this online or by phone. Next, report the scam to the local government authorities. You may also want to file a police report with your local law enforcement. Watch your credit reports and pay attention to activity on all your accounts to catch any additional fraud. You might also consider setting up a fraud alert or credit freeze.

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    Debit Or Credit Cards

    Debit and credit cards can be used to make purchases online or over the phone , which can make them popular targets amongst ID fraudsters.

    Skimming ATMs has been a common method of obtaining credit or debit card information. It can involve implanting a device into an ATM that reads and lifts information from the magnetic strip on the back of a card. Mounted objects on or near the ATM, pieces of plastic or metal that donât match the ATMâs original colour, or a protruding keypad could be indicators that the ATM has been tampered with, however it can be impossible to know for sure, and it is always recommended to always shield your pin.

    Disputing Your Own Credit Card Charges

    Credit Card Fraud The How To Guide

    Chargeback fraud, also known as “friendly fraud,” happens when a consumer makes an online purchase with his credit card and then calls the card issuer and requests a refund, citing fraud. The bank refunds the money and the consumer keeps the goods, leaving the merchant on the hook for the cash. In some cases, the consumer forgets which charges he made and in some, he’s intentionally committing fraud.

    Before you head down this road, make sure the charge wasn’t yours. It’s hard to remember every little transaction and some retailer transactions look unfamiliar on statements. For example, third-party payments systems, like PayPal, use the merchant’s name. One of these is an honest mistake the other is outright fraud. If you are intentionally committing chargeback fraud, it ends up costing retailers $11.8 billion a year, which will eventually get passed down to consumers. And it’s 100 percent illegal — you are exposing yourself to a host of consequences, including jail time.

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    Famous Credit Fraud Attacks

    Between July 2005 and mid-January 2007, a breach of systems at TJX Companies exposed data from more than 45.6 million credit cards. Albert Gonzalez is accused of being the ringleader of the group responsible for the thefts. In August 2009 Gonzalez was also indicted for the biggest known credit card theft to date information from more than 130 million credit and debit cards was stolen at Heartland Payment Systems, retailers 7-Eleven and Hannaford Brothers, and two unidentified companies.

    In 2012, about 40 million sets of payment card information were compromised by a hack of Adobe Systems. The information compromised included customer names, encrypted payment card numbers, expiration dates, and information relating to orders, Chief Security Officer Brad Arkin said.

    In July 2013, press reports indicated four Russians and a Ukrainian were indicted in the U.S. state of New Jersey for what was called “the largest hacking and data breach scheme ever prosecuted in the United States.” Albert Gonzalez was also cited as a co-conspirator of the attack, which saw at least 160 million credit card losses and excess of $300 million in losses. The attack affected both American and European companies including Citigroup, Nasdaq OMX Group, PNC Financial Services Group, Visa licensee Visa Jordan, Carrefour, J. C. Penny and JetBlue Airways.

    Do Police Investigate Credit Card Theft

    Is my money safe from credit card fraud?

    With most credit cards, you are already protected with a zero liability policy. This means that you arent liable for any unauthorized purchases you report to your credit card company. There are other ways to protect yourself against fraud, too. To learn more check out our guides:

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    California & Georgia Experience The Most Identity Theft Incidents

    California has the highest number of identity theft incidences , and Georgia has the most cases per capita, according to a 2019 Federal Trade Commission report.

    Remedy: If you live in these states theres no reason to move just take action. It is your right and responsibility to view your own credit reports so you can detect fraud, but it also takes time. If you dont have it to spare, you may want to invest in a private credit monitoring service, such as LifeLock or Identity Guard.

    While these companies cant stop fraud from occurring, they do lay down roadblocks and will alert you to suspicious activity in real time. After that, they will guide you to resolutions.

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