Credit card holders who do not
take precautions while shopping, either online or in traditional stores run the
risk of having their funds siphoned off, either in one go or in small amounts
over a period of time. Such instances of credit card fraud can be prevented
through simple measures. Not taking
sufficient precautions is like leaving a signed blank checkbook near a gambling
den. When precautions can be taken to protect the checkbook that gives access
to funds in a bank account, should the same not be the case of credit cards?
Comparatively speaking a criminal in possession of details of a compromised
credit card can lay hands on funds far more easily than with a checkbook which
requires physical presence. So, the need to protect credit card and by extension,
its transactions is more pronounced.
The problem lies in identifying a
credit card fraud. While it would be impossible for a user to positively and
conclusively identify a fraud, it is possible to be wary of sites or vendors
when certain markers pop up that indicates a possible intent to defraud. Two
common red flags that need to be noticed are explained below.
Purchase through stolen cards –
To reduce the risk of being identified and to minimize chances of being
tracked, criminals do not use stolen cards directly, they use an ingenious
method to bill it to a different address while making money out of it. The cycle of credit card fraud is simple. A vendor on a website offers a widely
used product at discounted rates. A prospective buyer clicks and places an
order. The vendor, in turn, places the order for the product with another
genuine vendor, giving the billing address of the buyer. The payment for the
product will be made from a stolen credit card. Simultaneously, the buyer’s
credit card will be used to make a purchase of a different product for a
different customer. This is a vicious cycle of credit card fraud that befuddles
investigators, as the numbers of transactions become too many to track down the
offender. This method of fraud called triangulation which involves multiple
players, often involves two or more than two innocent players, who play roles
of facilitators without even knowing about it.
Frequent deduction of small
amounts of money – Many users of credit cards realize that funds have been
siphoned off their credit cards at periodic intervals for small amounts that
appear negligible but add up to a reasonable amount. This credit card fraud is
carried out by vendors in traditional retail stores who use the details
furnished by the customer for that particular sale to authorize a membership.
Under the membership scheme, a specified amount gets deducted from the credit
card of the user payable to the vendor’s account. Once the user realizes that
he is being defrauded, his complaint to the credit card firm results in the
issue of a duplicate cared and deactivation of the previous card. Since it
happens to be in the realm of a hazy and unclear domain, such problems of
credit card fraud continue and remain unresolved. The customer can safeguard his
interests by stating beforehand in certain stores that he does not wish to be a
part of any membership or offer.
