10 Reasons for the Recent Increase in Credit Card Fraud
April 2, 2012 | in Background Check
Credit card fraud is an increasingly popular form of theft wherein credit cards, or just credit card numbers, are used by unauthorized persons for payments or purchases. The prevalence of this sort of crime is directly tied to the frequency with which credit cards are being used in commerce. There are a number of factors contributing to the increase in credit card fraud. Here are ten of them:
- ‘Card not present’ transactions are more common than ever before. Purchases online, by phone or mail order have increased, so verification is more difficult, making it easier for thieves to misuse credit cards.
- Technology such as hand-held skimmers allow thieves to capture the data from a credit card, then re-use that information to commit fraud. This type of theft usually occurs in merchants where the cashier or service person can swipe the card out of view of the customer.
- ATM skimmers, a more sophisticated form of technology, have been used to intercept card information from unwitting ATM users. They can be installed virtually unnoticed on an ATM, to look like part of the machine.
- You may have noticed how seldom your ID is requested by merchants when using a credit card. Some are deliberate in their failure to do so, reasoning that the purchases are insured by the issuing bank. However, fraud costs both merchant and customer in the form of higher rates.
- Credit card thieves are becoming more sophisticated in their online operations as well. Websites which mimic the real thing convince consumers that they are dealing with a reputable or familiar entity, when they are in fact having their credit card info stolen from them.
- Email phishing has become more common. Credit card thieves will send consumers an email, posing as a bank or other business, advising the person that there is a problem with their account. They are instructed to click on a link, ostensibly to the entity’s website in order to verify account information. The link is fake, the website is fake, and the info the person provides is being stolen.
- The increase of e-commerce in general has made the incidence of fraud more frequent as well. There are simply more opportunities for thieves to access credit cards and credit card data as a result.
- Some thieves have stolen credit card offers sent via US Mail to victims’ homes. They submit the credit card application with a change of address request, obtain the cards, and off they go a-shopping.
- Credit cards themselves aren’t always the target of thieves, who know that the consumer is more likely to be protective of them than their alternate target: supporting documents. As careful as cardholders might be with the card itself, they can overlook the statements, receipts, and invoices that include all the info a thief needs to steal your credit account.
- Fraudulent charges can easily go unnoticed on a statement when the authorized user is making numerous transactions with it, and doesn’t review his statement carefully. This allows unscrupulous merchants to hide small purchases on cards without being detected.
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