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Credit card.

by: DSS Boxes505
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Credit card

Even though credit card is a modern convenience, it is susceptible to forgery and fraud. And the innocent victims’ account will be empty or at least he will be paying for items that he did not ever mean to buy. Credit card fraud is a very wide range of deception which has been mastered by a lot of credit card swindlers. The cost of credit card fraud in United Kindgdom alone in 2006 was an estimated £428 million. The amount is highet in other Euromian country and in the U.S.

The internet is a major platform for credit card fraud. This fraud is mostly against merchants who sell and ship products as well as merchants who provide online services. Since the customer is not present during the transaction and neither is the card, the merchant is basically relying on the information provided by the buyer during transaction. This creates a lot of problems for the merchants because the information is basically done by the means of email, phone or any other indirect means. Since the cardholder is not present at the point of sale terminal it becomes extremely difficult for the merchant to verify the actual card holder and whether it is actually he who is doing the purchase. Shippers are only liable for the delivery of the material, not the identification of the buyer since they are basically not involved in the transaction of payment for the goods. Some times merchants get the address of the card holder approved before delivering any good.

There are two types of fraud within the credit card identity theft category, they are, application fraud and account takeover:-

• When criminals use fake documents to open an account in someone else's name. it is called Account takeover. Criminals may try to steal documents such as bills and bank statements to get personal information . By gathering information about the intended victim the counterfeiter contacts the bank or credit issuer asking for the mail address to be changed. The criminal then reports the card lost and asks for a replacement to be sent. The replacement card is then used fraudulently.

• Skimming occurs when some dishonest employee of a legitimate merchant who would actually take the bill of the customer and when he pays with a credit card the employee would misuse the card. The perpetrator will take the PIN number of the card and use it for his own purchases.

Merchants will have to ensure the security of their terminals, and penalties for merchants can be severe, ranging from large fines to complete exclusion from the merchant banking system, and canceling his merchant account, which can be a death blow to businesses such as restaurants which rely on credit card processing.

Credit cards surely make trading easier. The issuers are trying to bring the level of forgery to zero so that people around the world can trade more safely, more securely. It is expected that within next few years, they will succeed in the venture.