Credit card fraud
Credit card fraud is one of many form of frauds that involve credit cards, charge cards, debit cards, or prepaid cards.
Typically, the fraudster causes a credit card of another person to be charged for a purchase. Today, half of all credit card fraud is conducted online, meaning that the fraudsters make online purchases with the credit card details of other people.
- "mail non-receipt fraud" is when a new or replacement card is sent by the bank, never to be received by the intended recipient. Many banks send out inactive cards, which will not be authorised until the account holder confirms their identify and card number.
- "chargeback fraud" is when a legitimate cardholder uses the card to purchase goods, or a service, and then when the statement comes, claims that they never authorised the transaction, or they never received goods or service ordered.
- "skimming" is when an unscrupulous employee at a legitimate merchant takes a second copy of the card details magnetic strip before processing the payment through the official EPOS terminal. This copy of card details, is sold on the black market to fraudsters who clone the cards.
- skimming of magnetic stripe details has become slightly less prevalent after the introduction of CVV or CVS codes, which are not encoded on the magnetic strip, but are printed on the card - normally on the reverse of the card.
- skimming of magnetic stripe details together with recording of PIN numbers entered into ATMs has been seen, where a small skimmer device that reads the magnetic stripe is attached to the card slot of an ATM, together with various devices to monitor the keypad, either by attaching a fake fascia over the genuine keypad, or by a spy camera.