With credit card fraud on the rise, especially on the Internet, are any of us safe? The very idea of a complete stranger being able to gain access to ones financial accounts and siphon off large amounts of money before we even know what is happening, certainly has me frightened.
Surely it is still safe to enter credit card information on a secure online order form, though, right? Unfortunately, the security on many of these online check-out forms is not entirely up to the task these days, and hackers have become a smarter, more dangerous breed, mindlessly intent on getting their sweaty hands on your hard-earned cash.
Largest Credit Card Breach in U.S. History
In the more recent news, it has been reported that three men had been arrested and charged with illegally gaining access to the files of Heartland Payment Systems, the world’s ninth largest credit processing company, and stealing more than 130 million credit and debit card numbers.
One of the men, 28-year-old Albert Gonzalez from Miami, has been tied to other large-scale data theft cases in the past, one of which was the theft of more than 40 million credit card numbers from TJ Maxx, Barnes & Noble, and other companies last summer.
The other two men charged alongside Gonzalez with regards to the theft from Heartlands remain unnamed, but reports seem to suggest that they are from somewhere in Russia.
While this is perhaps an extreme case of credit card theft and fraud, there is no doubt that such a crime does happen, and it is a serious one. You should always remain vigilante of who you give your credit card details to, both out and about in the real world, and online.
Stolen Credit Cards are for Sale Cheap on the Black Market
If it were not bad enough that both your privacy and your finances have just been violated, apparently that violation garners a hefty price on the black market. Highly personal information is being sold to cybercriminals on the Internet, and it is a lot easier than you might think.
At the epicenter of secret internet marketplaces in St. Petersburg Russia, is a rampart movement of selling off credit card data. Many of the credit card details are sold in batches containing multiple cards all at a relatively low prices.
The Cyber-Black Market is composed of a “club” of cybercriminals who network with each other online. Many of the crooks know each other and their customers know who to go to when they want to obtain credit card information. You can think of these groups as “cyber-gangs”. Just as in the case of the Hartland breach, a group of cyber criminals were responsible for the attack and not a single person operating alone. It is a simple task for them to steal and market credit card information for the purpose of a quick pay-day.
Senior security analyst at the security firm IRM, Dr. Neil Barrett, said in a recent statement in regards to the selling and transfer of credit card details, "It's not done through open access websites or newsgroups. These are point-to-point chat sessions between individual groups of hackers on an IRC channel or a side channel off an IRC channel. Junior hackers move up the scale until they are invited into a senior channel with just half a dozen people exchanging tips, tricks and credit cards. Hacking a credit card is the entry requirement for people who want to move up this ladder."
How Do You Protect Yourself Against Credit Card Fraud, Identity Theft and Other Online Scams?
So what can be done to protect yourself from these kinds of data thefts? To recognize and prevent online credit card fraud, it is recommended that you read the following credit card scam prevention advice.
Tip #1 - For one thing, when it comes to security, debit may not be your safest bet, says Paul Stephens, director of policy and advocacy for Privacy Rights Clearinghouse. The reason? With a credit card, you may discover unauthorized charges on your statement, allowing you to dispute them and have them removed immediately, without losing any money. With a debit card, however, it's an entirely different story.
Tip #2 - Keep an eye on your credit card every time you use it, and make certain it is returned to you as soon as possible. Try not to let your credit card out of your sight whenever possible. Unfortunately, in this day and age, it is difficult to trust anybody. This may apply in a situation as simple as handing your card to a restaurant waiter. Be sure that it is returned to you promptly while knowing the location of your card at all times.
Tip #3 - Never give your credit card number out over the phone, no matter how reputable you think the company may be. In performing transactions, you must do it through an online purchase forum on the company’s website, or in a face-to-face setting.
Tip #4 - When making transactions online with your credit card, remember to look for the “padlock” icon on the bottom of your web browser application. The padlock icon may also be present in the URL field on some web browser programs. This will ensure that the web page currently viewed is able to encrypt information sent over the Internet.
Tip #5 - Credit card information can be compromised when your PC is infected with malicious software or spyware. It is recommended that you clean and rid your system of any malicious software with a reputable anti-spyware or anti-virus program. Many spyware threats are able to track your online activity and ultimately steal your personal information which can include your credit card number.
Tip #6 - Make certain that any website you intend to use your credit card on is legitimate and has good standing. A simple way to check this is by running a search on Google, or perhaps contact the company via email or telephone and speak with them about any reservations you may have.
Tip #7 - Remember to save your receipts in order to check them alongside your monthly credit card bills. If you discover any charges that you do not have a receipt for - or that you do not recognize - report these charges promptly (and in writing) to the credit card issuer.
Tip #8 - Keep a list in a secure place with all of your account numbers and expiration dates, as well as the phone number and address of each bank that has issued you a credit card. Keep this list updated each time you get a new credit card, and if you move, notify your credit card issuers in advance of your change of address.
Tip #9 - Ideally, it’s a good idea to keep your credit card separate from your wallet or purse, perhaps in a zippered compartment or a small pouch. This way, if your wallet is stolen, you will at least still have your credit card safe and sound.
Tip #10 - Theft of your credit card information can be the result of clicking on a malicious link in a spam message that redirects you to a phishing site asking for credit card numbers. Spam emails come in all different forms and those that appear to have come from a banking institution usually ask that you either update personal information or verify credit card details are very dangerous. It is suggested that you avoid opening spam messages and emails that appear to have come from your bank unless you are 100% sure it is legitimate. Remember, a bank will never ask for personal information such as a credit card number via email.
Tip #11 - If you relocate or change your home address, then it is essential that you update your banking information to reflect the new address as soon as possible. If credit card correspondence, such as a credit card statement, is sent to an old address of yours, then you could risk someone opening your mail and obtaining your credit card information. Updating your address with your credit card company will prevent persons at your old address from acquiring other personal information such as purchases made which is reflected on a statement.
Are You a Victim of Credit Card Fraud? Report It
If your credit cards are lost or stolen, contact the issuer(s) immediately. Most credit card companies have toll-free numbers and 24-hour service to deal with these emergencies and they are just as eager as you to avoid credit card fraud.
Local law enforcement will allow you to complete and file a police report if you suspect that you’re the victim of credit card fraud. You may seek professional assistance outside of your local law enforcement, such as the Federal Trade Commission, if you suspect credit card fraud has lead to identity theft.
According to U.S. law, once you have reported the loss or theft of your credit card, you have no more responsibility for unauthorized charges. Further, your maximum liability under federal U.S. law is $50 per credit card, and many credit card issuers will even waive that fee for good customers.