Credit card fraud

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Credit card fraud

  1. 1. Credit Card Fraud
  2. 2. Credit Card Fraud -Slide 5 -Slide 6 Implications of Credit Card Fraud Slide 8 Misuse of Information -Slide 13 Advantages and Disasvantages Slide 15 Advantages of Credit Cards -Slide 16 Disadvantages of Credit Cards -Slide 20 Advantages of Credit Card Fraud Slide 22 Disadvantages of Credit Card Fraud Slide 25 Types of Credit Card Fraud -Slide 28 Where does Credit Card Fraud happen 41 - - - -Slide
  3. 3. What is Credit Card Fraud ?
  4. 4. What is a Credit Card ? A plastic card issued by a Bank or Business for the purchase of goods on credit. Credit cards are the most often used electronic payment instrument.
  5. 5. What is Fraud ? Fraud is intentionally deceiving someone resulting in financial injury to to that person.
  6. 6. What is Credit Card Fraud ? A form of IDENTITY THEFT, that involves the misuse of a person's credit card information or the use of a counterfeit card.
  7. 7. What is Credit Card Fraud ? Persons use the information for the purpose of charging purchases to the account or removing funds from it.
  8. 8. Implications of Credit Card Fraud
  9. 9. The Implications of Credit Card Fraud Increased Debt payable by the victim
  10. 10. The Implications of Credit Card Fraud Inability to get loans and financial assistance due to bad credit, especially in countries like America.
  11. 11. The Implications of Credit Card Fraud Persons can be imprisoned due to their inability to pay their “creditors” obtained due to credit card fraud
  12. 12. The Implications of Credit Card Fraud Banks, too, lose Money. After they've allowed a Million dollar limit on a credit card, and that limit is reached, and they're not able to recieve payment from the Credit Card signatory, then they have to be written off as a bad debt, which is an expense to the card company.
  13. 13. Misuse of Information
  14. 14. Misuse of Information With credit card fraud, information is taken from the victim and used by the fraudster without authorization from the victim.
  15. 15. Advantages and Disadvantages of Credit cards and Credit card Fraud
  16. 16. Advantages of Credit Cards Quick way to Borrow If you need to buy something expensive and you can’t afford to pay for all at once, a credit card is ideal. If you don’t have the cash at hand or even in your bank account you can pay with a credit card and then spread the cost over a number of months. Credit cards are also an easy and secure way to pay for internet shopping. Plus, they are widely accepted around the world.
  17. 17. Advantages of Credit Cards Consumer Protection You get more protection if you pay with a credit card than if you pay with a debit card, cash or cheque. In other words, if the company goes bust, or your purchase is faulty or doesn’t turn up, you won’t lose out because you can claim the money back from your credit card provider.
  18. 18. Advantages of Credit Cards Card-Use Incentives − Some credit cards offer 0% periods meaning you can effectively benefit from an interestfree loan. You need to clear your balance before the 0% offer ends though otherwise you’ll be charged interest. The average interest rate is 18% - that’s quite high which is why you should pay your debt off before interest kicks in.
  19. 19. Advantages of Credit Cards Card-Use Incentives − Some cards even offer incentives to spend, such as cashback, loyalty points or Air miles, which means you could actually make money from your credit card. These are only worthwhile if you pay your bill in full otherwise the interest you’ll be charged will be more than the value of the rewards.
  20. 20. Disadvantage of Credit Cards Blowing your Budget – The biggest disadvantage of credit cards is that they encourage people to spend money that they don't have. Most credit cards do not require you to pay off your balance each month, so even if you only have $100, you may be able to spend up to $500 or $1,000 on your credit card. While this may seem like 'free money' at the time, you will have to pay it off and the longer you wait, the more money you will owe since credit card companies charge you interest each month on the money you have borrowed.
  21. 21. Disadvantages of Credit cards High Interest Rates and Increased Debt Credit card companies charge you an enormous amount of interest on each balance that you don't pay off at the end of each month. This is how they make their money and this is how most people in the World get into debt. . A good way to look at this is in comparison to what you would earn in interest from a bank or owe in interest to a bank loan: Savings accounts may pay you around 2% interest; if you have a loan from a bank you may pay them around 10% interest; if you owe money to a credit card company, you may pay them around 20% interest.
  22. 22. Advantages of Credit Card Fraud Revenue for the Fraudster The Fraudster, with his new source of income will have sufficient revenue to enjoy his day to day life, that may be better than most. As well as, finance bigger schemes.
  23. 23. Advantages of Credit Card Fraud Relief of Debt Persons who are heavily indebted might go to “Credit Doctors”, where they can obtain stolen credit cards they use to pay off their debts.
  24. 24. Advantages of Credit Card Fraud Exploitation of Intelligence The persons investing their time in Credit Card Frauding Schemes are usually those who are highly intelligent. This frauding medium gives them an oppurtunity to build on their skills and develop it to perfection.
  25. 25. Disadvantages of Credit Card Fraud Accrued fees are payable by the victim The fees it takes to investigate your fraud, along with the fee for losing the card are payable by you to the bank.
  26. 26. Disadvantages of Credit Card Fraud Indebtedness A victim becomes heavily indebted, sometimes bankrupt because of credit card fraud.
  27. 27. Disadvantages of Credit Card Fraud Bad Credit Score Victims, unable to pay their debt will, as a penalty, see an increase in their credit score. This will result in them not being able to get loans etc..
  28. 28. Types of Credit Card Fraud
  29. 29. Types of Credit Card Fraud Online Credit Card Fraud The lack of interaction, over the Internet provides fraudsters with anonymity, so they've become more daring. They have even gone to the lengths of posting stolen credit card numbers online, making it accessible to anyone.
  30. 30. Types of Credit Card Fraud Misuse by Family Members Family members sometimes use a victim's credit card, without permission. They are also sometimes sold to thieves.
  31. 31. Types of Credit Card Fraud Organized Crime Rings Nigerian crime rings are most popular for acts of Credit Card Fraud. They steal Bank and Credit Card information from the mail and then use it to create fraudelent identification cards, drivers licences and .. Credit Cards
  32. 32. Types of Credit Card Fraud Advance Payments Consumer regulations request that a person's account is immediately credited, even before the cheque has cleared. Using counterfeit cheques, an advance may be made on a Card's account before their is time to verify the authenticity of the cheque.
  33. 33. Types of Credit Card Fraud Stolen Card Numbers Numbers may be stolen using “Shave and Paste”. Old card numbers are removed, and the numbers of the victim's card placed on this card.
  34. 34. Types of Credit Card Fraud Stolen Card Numbers “Counterfeit Cards” this is normally done in conjuction with an employee. Basic white plastic cards, are designed and decorated with a victim's card info and then te fraudster goes in the store and uses it with the employee like an average credit card.
  35. 35. Types of Credit Card Fraud Telephone/ Mail Order Fraud/ Lotto Scam Fraudsters will offer a Free Trip, or a significant some of money that the victim has won. Before, however, the victim can collect on their prize, they must first pay a “handling” fee. The victim will give the fraudster their credit card number and then the fraudster charges purchases to the victim's account.
  36. 36. Types of Credit Card Fraud Telephone/ Mail Order Fraud/ Lotto Scam Also, fraudsters may select a random person from the phonebook and then pretend to be a representative fm a popular car company. They will report to the victim that their card has been obtained by criminals. They are then asked to read their credit card number for verification. Many persons fall for this scheme, Will You ?
  37. 37. Types of Credit Card Fraud Mail Theft Victim's may apply for a new credit card from the book, and request that it is sent via mail. It may then be obtained for use by those that check the mail at the post office. If it does pass this byway safely, it may then be obtained by criminals who check people's mail boxes for such documents. Like the Nigerians.
  38. 38. Types of Credit Card Fraud Credit “Doctors” Persons with bad credit that can't obtain a proper credit card from the proper Financial Institutions often go to “Credit Doctors” to obtain stolen credit cards. Though some patients of these Doctors are ignorant of how they obtained these cards, most are knowledgable of the situation.
  39. 39. Types of Credit Card Fraud Account Takeover The fraudster may pretend to be the owner of the card, and request a change of Address. They may report the card lost or stolen and ask that the new card be sent to the new address. They will then use it to make purchases, while the amount is still being charged monthly to the victim's account.
  40. 40. Types of Credit Card Fraud Other Forms of Credit Card Fraud  False Applications  True Name Fraud  Non – Receipt Fraud  Creditmaster  Probing  Skimming  Pre – text calling
  41. 41. Where does credit card fraud happen often ?
  42. 42. Where does Credit Card Fraud happen ? Supermarkets (Pricemart, Megamart, Brooklyn)
  43. 43. Where does Credit Card Fraud happen ? Medical Institutions (Pharmacies & Hospitals)
  44. 44. Where does Credit Card Fraud happen ? Shopping Centres (Azan, Bashco, Woolworth)
  45. 45. Where does Credit Card Fraud happen ? Clothing Stores (Lees, Shhh, Ammars)
  46. 46. Where does Credit Card Fraud happen ? Fast Food Franchises & Restaurants (KFC, Burger King, Golden Bowl)
  47. 47. Where does Credit Card Fraud happen ? Hotels & Guest Houses (Iberostar, Rio, South Beach)
  48. 48. Where does Credit Card Fraud happen ? Banks (Scotia, RBC, NBC)
  49. 49. Where does Credit Card Fraud happen ? High Scale Bars & Cafes (V-bar, Cafe Blue)
  50. 50. Where does Credit Card Fraud happen ? The Internet (Craigslist, ebay, amazon, omegle)
  51. 51. Where does Credit Card Fraud happen ? Your Back Pocket.
  52. 52. Where does Credit Card Fraud happen ? Persons can be victimised by simply having their credit card in their back pocket, where it can be scanned and its information read.
  53. 53. Strategies to overcome Credit Card Fraud
  54. 54. Strategies to overcome Credit Card Fraud Privacy Instituting, in public areas, private spaces where one can safely carry out a transaction using credit cards
  55. 55. Strategies to overcome Credit Card Fraud Magnetic Wallets Persons can invest in magnetic wallets that prevent the scanning of credit card information by blocking the signal.
  56. 56. Strategies to overcome Credit Card Fraud Proper Identification Proper Identification of persons can help in the reduction of credit card fraud. This will reduce the possibility of persons who dont own the credit card using the credit card
  57. 57. Strategies to overcome Credit Card Fraud Adequate Surveillance Constant monitoring or surveillance of places where credit card card fraud occurs most often. So if fraud were to occur, the suspect could easily be caught.
  58. 58. Strategies to overcome Credit Card Fraud Computer Security Websites
  59. 59. Strategies to overcome Credit Card Fraud Prevention. Truthfully, if people were more responsible and careful with how they handle their credit card and their credit card information, it would be harder for fraudsters to obtain information.
  60. 60. Strategies to overcome Credit Card Fraud Education. Tellers could be properly educated on how to recognize a legitimate credit card, and be to identify all the security features of a legimitate credit card. The chances that a fraudulent card would contain all these security features is very rare.
  61. 61. Strategies to overcome Credit Card Fraud Financial Institutions developing relationships with Law Enforcement. If there are proper relationships established between these Financial Institutions and Law Enforcers, with their is evidence of credit card fraud present, it may be easily and quickly dealt with.
  62. 62. Strategies to overcome Credit Card Fraud by the Financial Institutions New Account Screening Ensure that Institution's employees thoroughly check and ensure that information is accurate.
  63. 63. Strategies to overcome Credit Card Fraud by the Financial Institutions PIN Activation Credit Card Holders are normally required to provide their PIN if they chose to activate their credit cards over their phone. If they fail to provide this PIN, they cannnot activate their card over the phone.
  64. 64. Strategies to overcome Credit Card Fraud by the Financial Institutions Smart Cards Instead of using holograms, smart cards use microprocessor memory chip. This means that unless the signatory is holding the card, in can't be used. It also works with a PIN. Purchases cannot be made without entering this PIN.
  65. 65. Bibliography. <http://money.howstuffworks.com/identity-theft1.htlm>  <http://www.law.cornell.edu/wex/credit_card_fraud>  “CREDIT CARD FRAUD” Lăcrămioara BALAN, Mihai POPESCU University of Suceava, Romania 
  66. 66. Participation. Evans, Shamoya 100%  Hall, Jody 100%  Moncrieffe, Harrington  Multan, Tajwain 100%  - 410% - 100% -

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