Credit card fraud remains as
one of the biggest sources of financial losses in the world today. With the
popularity of ecommerce stores, online business outlets, Internet shopping
platforms and Web-based financial transactions, more users are being victimized
by these criminal syndicates that operate credit card scams and identity theft
schemes. This is shown by the most recent complaints posted in BigScammers.Com
against card not present scams.
In the USA, billions of
dollars in losses due to credit card fraud and other online scams that involve
credit cards are reported each year by online crime reporting centers and
ecommerce security groups. In 2014, $8 billion of losses were reported by these
cyber security experts. Today, they are predicting a 125% growth in these
losses due to credit card scams by 2018. This means businesses, banks and Web
shoppers in the USA would most likely lose around $19 billion in the next
couple of years because of credit card and identity theft.
Monthly online scam reports
in the USA are also growing at an alarming pace. Many of these involve credit
card fraud. Last year, there were over 600 monthly online scam incidents that
were reported by American users. Just during the first half of this year, there
are more than 800 monthly Web crime cases that were filed by users in the USA.
This indicates an astounding 30% growth
in online scams across the USA.
There are advanced online and offline security technologies that are designed to stop credit card fraud.
This makes it harder and more complex for criminal syndicates to use stolen
credit cards to purchase products and digital currencies on the Web. This also
makes it more difficult for these fraudsters to cash out stolen credit cards.
However, many criminals
still manage to use stolen credit cards. A lot of them can also cash out these
cards. How exactly are they doing this, even with the latest online and offline
security protocols, Web privacy technologies and manual identity verification
procedures?
How Scammers Commit Credit
Card Fraud
First, they need to steal
the credit card details of unsuspecting users. What many criminal syndicates
around the world do is bait victims through phishing scams and extortion
schemes on the Web.
These phishing scams are
designed to trick users into entering their financial account credentials in
fake websites, which are linked by deceptive messages. These are mostly sent
out via email and SMS and are laced with fake urgency claims. On the other
hand, the most prevalent online extortion schemes on the Web today that are
used by some criminal syndicates for their credit card scams are online dating
scams and tech support fraud.
Second, many of these
scammers use online platforms and Web technologies to use these stolen credit
cards. That's because it's more risky (and costly) to use offline technologies
for committing credit card fraud.
So, what they do is
establish safety drop-off points as delivery addresses for physical products,
which they purchase from popular shopping sites through these stolen cards.
Many of these ecommerce platforms offer gifting features, which simply means
buyers can have their purchases delivered to others with different addresses
than the addresses in the cards that they use.
To get these safety drop-off
addresses, some of these criminal syndicates use social marketing tactics in
their online dating scams. What they do is to convince unsuspecting users in
popular dating sites and apps to receive deliveries for them and send it back
to their other safety drop-off points. These are mostly the addresses of other
scammers who buy these stolen products from them.
On the other hand, their
online dating scam victims are left holding the bag when authorities begin to
investigate. These victims unknowingly participate in the product fencing
operations of these fraudsters, and a few of them end up doing time in federal
prison for these wrongful accusations.
In some instances, these
buyers don't know that they're purchasing stolen products. So, when authorities
begin to investigate, they're wrongfully accused of credit card fraud and
product fencing scams.
Bigger criminal syndicates
devise more complex systems and processes for their credit card fraud
operations. What they do is steal personal details, financial credentials and
government-issued photo IDs of their victims. They mainly do this through
intricate phishing scams, online dating schemes and fake Internet business
opportunities.
What some of these
fraudsters do is trick users in unknowingly participating in their money
laundering and credit card fraud operations. They entice them to go on a
business venture with them for an irresistible revenue share guarantee in
exchange for minimal administrative work. What they ask their victims is to
simply register a business in their countries and apply for an online merchant
account.
