Card scams are all around us. Here’s how to avoid them.
By Det. Trent L. Koppel
I get asked all the time, “How can someone else use my credit cards when they’re right here in my wallet?” It does seem unlikely that another person could gain access to your card number without physically having your card, but unfortunately, it’s entirely possible. And it is happening more and more. Identity theft is one of the most common crimes in America, and credit card fraud is one of the most common types. We consumers need to remember: The “bad guys” who commit these acts are very sneaky, and will stop at nothing to get what they want.
I recently went to a very informative training seminar presented by the Maryland Heights, Mo., Police Department. It was led by Det. Sean Fanning, who spelled out the methods by which credit theft happens. Let me explain how it all works, so you can take steps to protect yourself and your business.
- The bad guy gets your credit card information, sometimes without obtaining physical control of your card.
How does this happen? Sometimes the criminals use card skimmers to extract the information from a card once it is swiped through a credit device. Swiping is the process by which you slide your card through an ATM or the card reader at a store checkout counter. You should watch the sales clerk carefully each time you make a purchase – if the person tries to swipe your card through more than one device, there’s a problem!
Of course, criminals also can simply steal your wallet to gain access to your credit cards. One trick they use is to steal just one of the cards you carry in your purse or wallet. This way, you may go for days without knowing the card is missing, and that gives the suspect plenty of time to use it.
I even have seen cases where the bad guy photographs a credit card with his cell phone, then embosses it onto a “recreated” card. Once the information is placed onto the dummy card, the fraudulent spending begins.
In some cases, the dummy cards are pre-paid Visa or Vanilla cards you can get at the local Walgreens. The card’s original digits are erased with an acetone-like substance similar to nail polish remover. These pre-paid cards are easy to modify because they only have the account numbers printed on them, not embossed.
- The fraudulent card is then run through a card reader device available online or at the local Best Buy, Target or Wal-Mart.
These card readers are legal to sell and purchase, and they serve a legitimate commercial need, but they are also easy to use for illegal purposes. The card reader reads the stolen card, then the information is uploaded to a computer by a USB connection. The criminal may have 500 or more credit card numbers on this computer.
- The stolen information is uploaded to a pre-paid credit device.
Next, the magnetic stripe is re-encoded to match the number on the face of the card. Or the account number from the stolen card is embossed onto the blank card, creating the appearance of a legitimate one. Sometimes the bad guy will go as far as embossing his own name onto the card to legitimize the look of it.
It’s important to remember that a credit card’s magnetic stripe contains three “tracks” of data. The first and second tracks are encoded with the cardholder’s account information, including card number, full name, expiration date and country code. Additional information can be stored on the third track; however, this track is rarely used and may not always be present on a card.
I hope this information helps clear up questions surrounding the manufacturing and remanufacturing of credit cards, and helps you understand where your credit card information comes from and what can happen to it. You should know that the pattern by which a criminal uses stolen cards and account information is generally the same.
First, the person typically tests the card by swiping it at a gas pump. If the card “reads” or goes through the first time, the bad guy will use the credit device as quickly as possible, and for as much as he can. In most cases, he will use the card to make four or five big purchases, and then trash it. This lessens the chances of his being caught.
Watch this amazing YouTube® video of how a thief actually steals your credit card info in a matter of minutes: https://www.youtube.com/watch?v=kv72936OWck
Here are some simple things you can do to reduce your chances of having a credit card compromised:
- Keep your credit card on your person if at all possible.
- Never allow anyone else to use your card or PIN (personal identification number).
- Destroy all old documents in your home that may contain your credit card information.
- Lock up your credit cards when staying in a hotel room.
- Try to have only one credit card, or carry only the ones you truly need. Additional cards will make you more susceptible to victimization. MM&E
Det. Trent L. Koppel is an adjunct professor at Maryville University in St. Louis.