What is Online Credit Card Fraud?

Credit card fraud has become such an issue that no precise number can truly defined the global losses.  And while most financial institutions are rather sensitive about the subject, a report from the FBI indicated that credit cards were largely responsible for the $315 billion loss the U.S. endured from financial fraud in 2005.  A recent study in Europe also revealed that well over 22 million consumers fell victim to credit card fraud in 2006. 

To truly understand the risk and likelihood of credit card fraud, you must first make yourself familiar with a brand new lingo.  Terms such as "phishing", "pharming", "skimming" and "dumpster diving" may not sound malicious, but these are in fact just a few of many ways that money can be thieved from your credit card. 

Below you will find more details on these popular techniques and how they are used to commit credit card fraud: 

Phishing - This technique refers to randomly distributed emails that attempt to trick recipients into disclosing account passwords, banking information or credit card information.  This one scam has played a major factor in the crisis we face today.  Since phishing emails typically appear to be legitimate, this type of crime has become very effective.  Well designed, readily available software utilities make it nearly impossible to trace those guilty of phishing.  Phishtank, an anti-phishing organization, recently revealed that nearly 75,000 attempts of this nature are made each month. 

Pharming - This new technique is one of the most dangerous of them all.  Pharming involves a malicious perpetrator tampering with the domain name resolution process on the internet.  By corrupting a DNS, (Domain Name System), a user can type in the URL for a legitimate financial institution and then be redirected to a compromised site without knowledge of the changes.  Unaware of the background predators, the consumer types in their bank account details or credit card number, making them the latest victim of fraud. 

Skimming - refers to a process in which a special device is used to copy encoding data from the magnetic strip of a credit or debit card.  This device is usually secretly mounted to an ATM machine as a card reader. 

Dumpster Diving - this shameless act refers to a process in which an individual vigorously sift's through someone else's trash in search of personal and financial information.  With a mere credit card approval that contains a name and address, a criminal can easily open up a credit card in your name and accumulate substantial debt in no time. 

Taking Action

When credit card fraud strikes, it's crucial that you take action immediately.  The longer you wait, the greater the damage inflicted, and the longer the road to be traveled to resume your identity. 

Here is what can be done if you suspect credit card fraud:

     Immediately call the credit card issuer if your card is stolen or lost

      Take an extra step by following up that phone call with a letter to the card issuer.  This letter should contain the date the card came up missing, the date you reported it as lost and the pertinent details of the card

      After reporting credit card fraud to the issuer, you should be sent an affidavit in the mail.  Fill out the form in it's entirety, sign and promptly return it. 

You can learn many more ways to protect yourself from credit card fraud by visiting www.ftc.gov , the website for the U.S. Federal Trade Commission.  


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Spyware has many ways of getting onto your computer, such as:

When you download programs - particularly freeware, or peer-to-peer sharing programs.

More covertly, spyware can install itself just by you visiting certain sites, by prompting you to download an application to see the site properly.

ActiveX controls. These pesky spyware makers will prompt you to install themselves while using your Internet browser