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What Are The Dangers Of Credit Card Skimming |
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Written by Webmaster
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Thursday, 30 October 2008 |
By Alisdair Cosgrove
 Credit card skimming is causing an international problem which accounts for losses of over one billion dollars a year.This credit card scam is common in Latin America as well as Europe and Asia, and now it is starting to be seen in the United States.
This is an easy credit card scam to run when your card is used to make a purchase and it is scanned by the store employee at the stores cash register.That employee may swipe your card for payment, but may additionaly swipe the card with a small machine they hold in their hand known as a skimmer, that also stores information from your card into its system.The skimmer can retain the information on hundreds of debit and credit cards and then it is used by unscrupulous people to print counterfeit cards.After your information has been fed into the skimmer it can then be downloaded into a computer and emailed to any worldwide location, as there are skimming rings working all over the world.It was not as easy to commit this fraud in the past, because the card skimmers were
very large machines that had to be hidden under the check-out counter.
Due to the great advancements in technology of the past decade, the skimmer is streamlined and the small hand-held machine is easy to hide from the view of the unknowing customer.These skimmers are easy to buy; they can be purchased over the internet at around three hundred dollars, but the machine needed to make counterfeit credit cards is a much larger investment; costing in a neighborhood from five thousand to ten thousand dollars.
One form of credit card skimming is done directly through the card terminals by placing a skimmer bug into the terminal and then retrieved with the credit card information on it.The older credit card terminals are the only type that can be violated in this kind of skimming process and since the newer terminals have been utilized the bugging scam has all but stopped happening.
As soon as the credit card skimmers have confiscated all of the information they need from your card, they will begin to make purchases of their choice with your credit card number.Online shopping has become more and more popular and this is the reason why so much of the credit card fraud is taking place over the internet because it is very easy for the wrong people to gain access to your credit card information.The information skimming thieves will check the credit card information for its validity is by making several purchases of low cost items on internet websites to find out if the cards are active.
The real victim in this crime may be the merchant who had the employee who did the skimming, because the cardholder is usually only responsible for up to fifty dollars of the total amount charged on his card.The merchant is at risk for the loss on his merchandise and is one hundred percent responsible for the skimmers activities and the fees charged for the investigation. Investigation fees paid by consumers and businesses recently was estimated to be a half-billion dollars in annual revenue for credit card companies and this money is used by the card companies to offset costs to investigate charge back claims by their customers.
The persons who are operating this type of credit card scam are aware that a purchase of at least $2000 has to be made before any criminal investigation can start.
Alisdair Cosgrove is a freelance writer specializing in personal finance. You can read more of his work at www.JSNet.org for credit card comparisons including credit cards with cash back and also offers a comprehensive list of airline credit cards. You can read more about credit cards from his on site article, 'prepaid credit cards are helpul for teens'.
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Last Updated ( Thursday, 30 October 2008 )
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