Common Occurrences: 9 Types of Credit Card Fraud

There are millions of bank card holders around the world. Bank cards are a convenient way to make online purchases, especially when you do not have enough money. You can lower your interest costs and earn rewards points. There are also lenders that offer bank cards to people with bad credit. But did you know there is another side to this? Bank card usage is not only beneficial for you, but it also poses a risk of fraud and theft.

This article will provide us with additional information about the risks of bank card fraud.

What is bank card fraud?
Bank card fraud can take many forms.

  1. Card-not-present (CNP) fraud
  2. Counterfeiting and skimming fraud
  3. Bank card fraud – lost and stolen
  4. Card-never arrived-fraud
  5. False software
  6. Account Takeover
  7. Phishing
  8. Pagejacking
  9. Knowledge Breaches
  10. Card Testing
    How to detect fraud on bank cards?
  11. Be on the lookout for suspicious transactions
    Customer service that is responsive and helpful
    Card Security Options
    Threat scoring
  12. Knowledge Enrichment
    Avoiding bank card fraud
    The Backside Line
    What is bank card fraud?
  13. Bank card fraud is the fraudulent use and theft of private information of a cardholder. The web and the many eCommerce sites that offer your data make it easier than ever for thieves to steal your information.
  14. Before the internet became a part of society, it was common to imagine a figure in black pulling your bank card from your pocket. Con artists have a variety of ways to steal money from your bank card. The majority of these methods don’t even require the card itself.
  15. Bank card fraud can take many forms.
  16. Bank card fraud comes in many forms. This can happen online, over the phone, via text message, or in person. All of these are possible: the theft of playing cards from your mailbox, the theft of data due to a breach of information, or deception by bogus email. Here are a few options.
  17. Card-not-present (CNP) fraud
    Scammers steal bank card numbers and personal data, which they then use to conduct transactions on the phone or online. CNP fraud can be difficult to avoid because there’s no physical card to check and the service provider cannot verify the customer’s identity.
  18. Counterfeiting and skimming fraud
    Skimming of bank cards continues to occur despite the widespread use and popularity of playing cards. Skimmers are units that steal information from the magnetic strip of a bank card. Scammers connect them to readers in ATMs, retail stores, fuel stations and other institutions. The scammers then use your card for purchases, either by selling the information to other con artists or using it themselves.
  19. Bank card fraud – lost and stolen
    This is one of the most common types of bank card fraud. The thief takes another person’s card or uses a lost card. You can still avoid the worst damage by canceling or freezing the card as soon as possible by calling your bank. Some of them allow you to do this with the push of a button on their mobile banking apps.
  20. Card-never arrived-fraud
    You will receive your bank card in the mail 99.9% of the time after you apply for one. The fraud involving cards that never arrive occurs when they are either stolen from your letterbox – which is more common – or intercepted before they arrive.
  21. The Australian Funds Community recommends building a lockable mail box or, at the very least, inspecting it often to guard against this type of scam.
  22. False software
    False application fraud is when an account has been opened using the identity or information of another person. Someone could apply for a credit card in your name, rack up a lot of debt and damage your credit rating. If they apply for a bank card under a different name but link your checking account with it, you may also be charged the repayments. Before you realize you have been scammed, someone could rack up hundreds of dollars on a credit card or simply destroy your credit rating. It will eventually affect future mortgage applications.
  23. Account Takeover
    Account takeover is what happens when a fraudster gains access to another person’s account. Account takeovers are possible because the account may be linked to a credit card. The thieves can then steal the information and launch online payment scams.
  24. The problem becomes much worse if the account is used as an eWallet. A fraudster who has access to a BNPL account, crypto or neobank, can virtually withdraw or send money immediately.
  25. Phishing
    Phishing is a common way to collect private information. Over time, phishing scams have evolved from emails that appear to be “gifts” or “inheritances” into texts, emails and websites that are difficult to detect. Phishing is a scam that tries to trick the victim into clicking on a link and revealing their personal information. These can be obvious or convincingly realistic looking depending on the level of complexity. Fraudsters who have obtained this data can use it for a variety of illegal transactions.
  26. Pagejacking
    Online fraudsters create websites that closely resemble legitimate sites. The clients are then sent to a fake website where they are duped to make a purchase and give criminals access to their personal information and bank card.
  27. Knowledge Breaches
    Customers can disclose their financial data without clicking on a link or visiting a fake website. A breach of information that exposes such data can cause thousands and thousands of dollars in damage. Some of the most notable breaches include those at Marriott and Goal, which exposed the financial and personal data of thousands and hundreds of thousands of customers and cost thousands and thousands of dollars in penalties and legal charges.
  28. Card Testing
    Card testing is a type of bank card fraud that occurs when scammers make a number of small purchases in order to test the validity of stolen information. After the transactions are cleared, the fraudster will make larger purchases in order to use the full balance on the card. Online fraud of this type can result in expensive fines and chargebacks. Card testing is one of the most common tactics used by scammers to test their ability with money once the information about them becomes public. This can be done by phishing or by using stolen identities.
  29. How to detect fraud on bank cards?
  30. Using the following tools and strategies companies can determine when card information has been stolen.
  31. Be on the lookout for suspicious transactions
    To detect fraud, it’s important to thoroughly review consumer data. Incorrect invoicing or incorrect transport data are red flags that require further investigation. Double-checking data can help an organization save money, time and reputation, even if the high-value, fast-moving cargo is not necessarily an indication of fraud.
  32. Businesses should also be on the lookout for small transactions that happen quickly one after another, as this is a sign of card testing. This type of fraud should be avoided by stopping the transaction processing and not shipping any products.
  33. Customer service that is responsive and helpful
  34. The first step in fighting pleasant fraud is providing helpful and attentive customer service. As well, ensuring that the fee descriptors and company name are in sync can stop pleasant fraud started by confused customers. If this type of fraud is common, it may be necessary to keep a list of repeat offenders.
  35. Card Security Options
  36. Bank card networks have implemented a number of security mechanisms to stop fraudulent activity. These include:
  37. Handle Verification Service: The Handle Verification Service confirms the identity of the cardholder by using the registered handle. The financial institution’s data is used to verify the handle.
  38. 3-D Safe (3DS), a safety measure, requires that customers enter a code in order to complete the transaction. Many card issuers offer the service under a variety of names such as Visa Safe (Visa), SecureCode(Mastercard), and SafeKey.
  39. CVV (Card Verification Value): CVV is a 3-digit number that can be found on debit and credit cards. The card verification value is used to verify that the card was in the possession of the purchaser at the time the transaction took place.
  40. Threat scoring
  41. Guidelines are used to assess risk in a common method of managing risks called danger scoring. These help in the creation of educated hypotheses about certain consumer behaviors. You may, for instance, use a risk rating to decide whether to authorize payment on your website.
  42. Heuristic standards are often used to identify bank card fraud. These are shortcuts that use if-then logic in order to provide quick conclusions. Companies with limited resources may choose to use a ready-made solution. People who have dedicated risk management teams prefer whitebox programs because they allow for more customization and flexibility.
  43. Knowledge Enrichment
    The primary challenge that firms detecting fraudulent bank cards funds must overcome is how to verify customers without increasing friction. If there are too many barriers between your customers and their purchases, they will eventually switch to your competitors.
  44. Information enrichment is one of the most interesting and useful strategies to establish identification. This is an invisible layer of security that comes from the acquisition of additional information on a single level. To illustrate:
  45. Machine fingerprinting: Determine if the user has previously connected to your website using the same machine. Are they going to fake their connection information?
  46. IP evaluation: Does the connection come from a Tor node or VPN?
  47. Look up the BIN number to check if you have the correct bank card. Pay as you go cards, for example, would make sense to a APAC shopper?
  48. Reverse social media check: Was the phone number or electronic mail address used previously to register on a social media website? The bio of the customer matches the information about the transaction.
  49. Avoiding bank card fraud
  50. You can take a variety of steps to reduce your risk of becoming a victim of bank card fraud. This includes:
  51. Keep your card close to you at all times when making purchases. You never know if it’s been cloned.
  52. Use warning if someone calls you without your permission. This includes avoiding unexpected phone calls, emails, letters or knocks at the door.
  53. Never reveal any private data or login information, such as your PIN and password.
  54. Cut up old bank cards. Be sure to remove the magnetic strip and chip.
  55. Update the software on your computer and mobile device.
  56. Use strong passwords all the time and do not use the same password across multiple accounts. Also, you should change your passwords often.
  57. Check that the card companies you are dealing with are reputable before making a payment.
  58. Only use non-public WiFi when necessary. It’s safer to use connections at home, where they aren’t often used by other people. The information web connection on your telephone is usually safer than those at coffee shops and restaurants.
  59. Secure websites are the best. You can determine which websites are safer by analyzing how the handle begins. People who begin with “https” will be safer than those who start with “http.”
  60. Never use a public computer without first logging off your bank and online accounts.
  61. Watch your posting. If you’re expecting the bank statement or official document but it hasn’t arrived, speak to the company that sent it.
  62. If you move, make sure that your mail will be redirected so that you can receive it.
  63. Avoid throwing away letters in the garbage, as they are easy to recover and may be used to steal your identity. Use a shredder, or delegate a confidential container.
  64. Posting on social media requires caution. Remember that anyone can access your posts, no matter where they are located. This means you should be careful when posting any personal information, such as the date of birth.
  65. The Backside Line
  66. Since the first bank cards were issued, fraud on bank cards has been a major problem. Fraud can be committed in many different ways. Some forms of bank card fraud can be easily identified, while others are more difficult to detect. In general, use caution when using your bank card. Read all fine print. Check your statements frequently to make sure your account is not tampered with.Marjorie Hajim oversees the search engine marketing for Pleasant Finance. Pleasant Finance, a leading mortgage matching service in Australia that specialises in consumer finance, is the number one in Australia. She is passionate about digital and natural growth, and loves to write articles for companies that are just starting out. She has contributed articles to Is it Vivid and EcommerceFastLane.