Credit Card Fraud
Credit Card Fraud is a harsh reality of digital age. If you are the owner of a credit or a debit card, there is a non-negligible chance that you may be subject to fraud, like millions of other people around the world.
Though in India, Reserve Bank of India (RBI) has done a commendable job to avoid credit card fraud. India was ranked among the top 5 countries with regard to credit card fraud, with more than one third of the people saying they had been scammed, according to the 2016 Global Consumer Fraud Report published by payments technology company ACI Worldwide.
The number of credit cards rose by a quarter to more than 38 million in the 12 months ending in May, while the number of debit cards jumped 17% to over 925 million in the same period, according to RBI data. But many of the cards continue to come with magnetic strips which store all important customer data and are more vulnerable to cloning.
The Indian central bank has instructed banks to issue more secure chip-enabled (EMV) cards, which require the customer to enter a PIN code or sign on the receipt. The deadline to completely move to EMV cards is set for the end of this year. But with large numbers of ATMs and swiping machines still not EMV compliant, meeting the deadline could be a challenge.
Steps taken by RBI
1. Two level authentication for online transactions. 1st level when you enter Credit Card details & CVV. 2nd level authentication is implementation of 3D Secure Code (Verified by VISA and Mastercard SecureCode)
2. Issuance of EMV Chip & PIN enabled Credit Cards
3. Option to select / set limit for International usage
4. Data Security standards for POS Terminals
5. SMS Alert to customer’s registered mobile no for every Credit Card transaction
6. OTP for IVR based transactions
Types of Credit Card Frauds
There are many kinds of credit card fraud, and they change as frequently as new technologies enable novel cybercrimes that it’s nearly impossible to list them all.
- Card-not-present (CNP) frauds
This, the most common kind of fraud, occurs when the cardholder’s information is stolen and used illegally without the physical presence of the card. This kind of fraud usually occurs online, and may be the result of so-called “phishing” emails sent by fraudsters impersonating credible institutions to steal personal or financial information via a contaminated link.
This is less common today, but it’s still worth watching out for. It often takes the form of “skimming” – when a dishonest seller swipes a consumer’s credit card into a device that stores the information. Once that data is used to make a purchase, the consumer’s account is charged.
How to protect?
- Don’t let your card out of sight. The waiters managed to steal data because unsuspecting customers would hand over their cards, which would then be secretly swiped and skimmed.
- Register your mobile number with the bank and subscribe for alerts for your transactions. Inform your bank as soon as you notice any suspicious spending and have your card blocked.
- Inspect an ATM before transacting and do not insert your card if you find any suspicious device connected to the machine. Entering the wrong PIN in the first attempt to ascertain if the machine is rigged or not.
- Remember your CVV number the three digit number at the back of your card—and then scratch it from your card.
But giving up on your card for good is not the solution. Think about the benefits that cards and other digital payment methods offer. You just need to be more careful and aware.
Credit Card Fraud News (Source-Indian Express dated on 5th Oct 18)
Case 1: Credit card fraud: 60-year-old doctor ‘duped’ of Rs 1.40 lakh
A FORMER Head of Department at KEM hospital was allegedly duped of nearly Rs 1.40 lakh after his credit card was used fraudulently to make multiple transactions last year. The 60-year-old doctor, who headed the physiotherapy department, approached Shivaji Park police station recently that registered an FIR on Saturday. The police said they are trying to identify the accused based on the establishments where the fraudulent transactions had been made.
An officer said Dr V Rajadhyaksha, the complainant, was issued a credit card in February 2017. In November, he got a call from his bank that checked with him if he had had made two transactions of Rs 20,000 each and another transaction of Rs 99,910, an officer said. The doctor did not recognise the transactions. He checked his mobile phone and found that there were no alerts or One Time Passwords (OTPs) shared.
After checking the card details, he found that the mobile phone through which the transactions had been carried out had a different service provider. He informed the bank that the transactions had been made in Delhi while he was in Mumbai during that time. After communicating with the bank several times, the 60-year-old approached Shivaji Park police station that lodged an FIR Saturday.
A senior officer said: “We have details, like the number using which the transactions had been carried out and where the payments were made. We are hopeful of tracking down the fraudsters on the basis of that. We are also checking why the complainant did not receive any alert on his registered mobile number.”
Case 2: Vishing case: Retired BEST official loses Rs 1.10 lakh claims police
A 59-year-old retired BEST official allegedly lost Rs 1.10 lakh to a vishing fraud, a month after he bought a credit card from a government bank.
The police said that the fraudsters already had the name and address of the elderly man due to which the latter didn’t find anything suspicious and shared card details with them. The case was registered with the Goregaon police earlier last week. The police, however, refused to divulge any details about the victim.
He bought a credit card with the credit limit of Rs 5 lakh in July this year.
“The complainant received a phone call from a person last week. The caller posed as government bank official and narrated the name and address of the complainant to verify his identity,” an officer from the Goregaon police station said.
The caller gained confidence of the complainant by getting his name and address correct. The person then inquired whether he had recently bought a new credit card and asked for some information for some verification purpose.
“After the complainant gave away the information of his credit card, an OTP was generated on his mobile phone. As the caller had already gained trust of the complainant, he ended up giving away the OTP as well. Within a minute he received three messages about Rs 20,000, Rs 10,000 and Rs 10,000 being transferred from his bank account. The complainant said he did not understand these messages and ignored them,” added the officer.
The following day, the complainant received three more messages from the bank informing that Rs 49,999, Rs 10,000 and Rs 10,000 were transferred from his account. “Soon after the messages, the 59-year-old received another phone call asking for another OTP number,” the police said quoting the complainant.
However, this time he got suspicious and didn’t reveal the OTP and instead informed his daughter about the incident.
“He even got a message that his card has been blocked but he didn’t fall for their claims this time and contacted the bank’s landline number following which he was informed that he has been duped,” said a police officer.
The retired BEST official approached Gurgaon police station and registered a case under relevant sections of cheating and IT Act.
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