By: Jason BaltazarMIS 304

Credit Card Fraud and Prevention

What is credit card fraud?

Credit card fraud is theft and usage of another person’s credit card for an unauthorized transaction.

The purpose may be to obtain goods or services without paying, or to obtain unauthorized funds from an account.

Credit Card Fraud By the Numbers

IC3 (Internet Crime Complain Center) reports that there were 275,284 complaints of internet crime around the country, of which only 72,940 cases were investigated by law enforcement.

Total dollar loss from all reported cases of fraud was $264.6 million.

Email (74.0%) and web pages (28.9%) were the two primary mechanisms by which fraudulent contact took place.

Individual Complaints

Individual Perpetrators

Top Countries by Perpetrators

California 14.6% California 15.8% United States 66.1%

Texas 7.2% New York 9.5% United Kingdom 10.5%

Florida 7.1% Florida 9.4% Nigeria 7.5%

2008 Top 10 IC3 Complaint Categories

32.90%

25.50%

9.00%

7.90%

6.20%

5.40%

2.80%2.50%2.20%

1.90%Non-delivery

Auction Fraud

Credit/Debit Fraud

Confidence Fraud

Computer Fraud

Check Fraud

Nigerian Leter Fraud

Identity

Financial Institutions Fraud

Threat

Popular Scams of 2008

Fraudulent unsolicited e-mails to commit identity theft. FBI fraud emails. Lottery Scam Unauthorized access to your personal email address, and

the fraudster sending phony distress emails to your contacts.

Overpayment Scam Roommate scam

Ebay Scams No delivery or receiving inferior products

Merchant Prevention (Online)

CVV/AVS Verification Ship to bill Call credit card company to verify information.

Call billing number to confirm order

IP Address

Red flagging bad orders Database of all bad orders linking to any matching new order if information is

identical.

Release form Additional documents Small charge verification

Calculating the level of risk based on the above factors

How your credit card company helps

24/7 Online and Telephone support View pending transactions

Locking your credit card after suspicious activity Data mining can help define and determine suspicious

activity

Call notification

What you can do to help prevent fraud.

Don’t give your credit card info online unless the website is secure.

Make sure the site is reputable/legitimate source. Check the BBB for previous complaints.

Use Paypal if possible.

Shred all credit card receipts and sensitive documents.

Enroll in a credit report service Freecreditreport.com

Password database program KeePass