Fraud prevention is a race between good and evil, so credit card scams are a mix of timelessness and novelty. Under these circumstances, it is essential to understand what the most common scams are, but one always needs to remember that somebody somewhere is thinking of something entirely new right now.
High-Tech Credit Card Scams
Security blogger Brian Krebs provides a straightforward overview of the most common credit card scams that result in card details getting compromised. According to the author, POS (point-of-sale) devices are quite vulnerable to malicious software being installed surreptitiously by hackers. The device can be located at a restaurant, shop, or some other similar vendor. Another efficient and lucrative credit card scam is perpetrated via skimming. In this scheme, fraudsters and ATMs or gas station pumps that had been tampered with become partners in crime. Once they collect the necessary information, they use the counterfeit cards to make purchases.
More danger lurks on the internet. Malware installed on a computer unbeknownst to its owner collects information submitted through forms in order to identify card numbers and account passwords. Phishing scams are widely used in the same purpose, email being one of the preferred means to do so. A customer swiftly turns into a victim when an ecommerce website or payment processor is hacked.
Two of the most recent and brand-damaging high-tech credit card scams involved Target and Home-Depot. The Target incident led to 40 million cards getting compromised in December of 2013, while Home Depot was unaware of a major security breach that allowed criminals to get access to 56 million credit and debit cards over no less than 5 months.
Low-Tech Credit Card Scams
Credit card scams don’t have be sophisticated to yield good results. An employer in a restaurant needs just a couple of moments to copy the details of the card belonging to a distracted customer. Krebs points out that there this type of scam is most frequently perpetrated by local gangs or by opportunistic seasonal workers who treat the customer as an additional source of income.
Some fraudsters are exceedingly versed in concocting plausible stories to extract what they need over the phone. In one recent scheme, perpetrators placed calls to random people, stated that they work for the bank’s fraud department, and claimed that an unauthorized transaction had taken place. Then, they proceeded to ask for the security code of the card from the potential victim, stating that this is an authentication method.
While requesting the security code seems bold, other fraudsters will not shy away from asking for the full card number. This scheme has to be carried out as early in the morning as possible so as to take advantage of the victim’s grogginess.
Avoiding Credit Card Scams
Thankfully, there are many online resources people can use to stay informed and therefore protected against online credit card scams. This comprehensive Question and Answer material addresses everything a consumer needs to know about credit card fraud. Some tips for avoiding internet fraud are available here. In case prevention fails, it is essential to act fast. This resource helps consumers understand what their liability is with respect to credit card fraud and what to do when the worst does happen.